Swiss Life (UK)'s group plans likely to be axed after acquisition
Swiss Life (UK)'s group risk business has been bought at the eleventh hour with a last minute bid from rival insurer UnumProvident.
An agreement has been signed for UnumProvident to acquire Swiss Life's group income protection (IP) business and the renewal rights to the group life and group critical illness (CI) business. The deal, involving an undisclosed sum, saves the group business from the same fate of its individual business, which closed in July.
Details of the provider's plans for Swiss Life's group portfolio are yet to be confirmed. However the provider has suggested that following the deal, the acquired products will not just be rebranded, but scrapped. "Swiss Life (UK)'s product range will disappear. Most of the features available in these products are in Unum's product range already. If certain features are out- standing and in demand, we were probably looking to introduce them in advance of the acquisition anyway," said Eugene McCormack, director of marketing at UnumProvident.
Swiss Life announced in September last year it was looking for a new parent for its UK arm. After failing to find a buyer, it announced last month it was closing the individual business and would also close the group business if a buyer had not been found by mid-August. There has been market speculation that AXA may yet make a bid for the individual business, but the insurer is refusing to comment.
UnumProvident, which alrea- dy has over a 42% share of the group IP market, will acquire a further 1,800 group IP policies, representing 280,000 policyholders, and renewal rights to around 6,800 group life and CI policies, covering 1.3m lives, through the deal. The agreement is subject to regulatory approval, but it is expected that the transaction will be effective on 1 January 2004.
Susan Ring, chairman and managing director of Unum- Provident, said: "I am pleased that our past success and strong financial position enabled us to secure this arrangement that protects the financial investments and insurance promises of Swiss Life (UK)'s group policyholders and its claimants. We take our leadership responsibilities very seriously."
A total of 250 staff are currently employed by Swiss Life (UK)'s group business and according to UnumProvident, 'a significant number' of redundancies will be made over the next two years.
