What You Need to Know
- The preneed insurance business reported $48 million in net income for 2020 on $491 million in revenue.
- Assurant, which sold Global Preneed, wants to cut down on exposure to interest-rate fluctuation risk.
- CUNA Mutual sees offering the product as a way to help increase middle-market consumers' financial stability.
CUNA Mutual today closed on a $1.35 billion deal to acquire the Global Preneed business from Assurant.
Assurant’s Global Preneed business is an organization based in Rapid City, South Dakota, that helps people plan ahead for funeral expenses. The business distributes whole life-based products through funeral homes in the United States and annuity-based products through funeral homes in Canada.
CUNA Mutual and Assurant announced the Global Preneed deal in March. They said at the time that they hoped to complete it by Sept. 30.
Assurant is a New York-based company that has been working for years to sell interest-sensitive life and health operations and tighten its focus on mobile phone insurance and other property and casualty insurance products.
“This sale marks an important milestone in the transformation of Assurant,” Alan Colberg, Assurant’s CEO, said in a comment about the deal.
CUNA Mutual is a Madison, Wisconsin-based company that has focused on distributing insurance products through credit unions and other financial institutions. That company’s executives have said acquiring the Global Preneed business will help it do more to increase the financial stability of middle-income families.
The Global Preneed Business
The Global Preneed operation now owned by CUNA Mutual reported $48 million in net income for 2020 on $491 million in revenue, compared with $52 million in net income on $486 million on 2019.
The business has about 2 million insureds, $7 billion in assets and $6.5 billion of coverage in force.
Earnings were almost as high in 2020 as in 2019 in spite of the impact of the COVID-19 pandemic on insureds’ mortality.