Simplyhealth Group Limited has sold its private medical insurance (PMI) business and its administration to AXA PPP healthcare, subject to regulatory approval.
Simplyhealth will continue to provide its cash plan and Denplan offerings, and intends to grow its cash plan, dental and vet businesses.
The insurer is also planning to continue its strategy of investing in "everyday health" having recently acquired Care & Mobility Limited, a West Midlands mobility product retailer.
A new partnership model for private dentistry has also been launched by Simplyhealth recently.
The sale follows a strategic review of Simplyhealth's activities led by Romana Abdin, chief executive of Simplyhealth, including a customer insight project interviewing over 5000 people.
Simplyhealth is currently the UK's fifth largest provider of PMI offered through individual and group policies to both SMEs and large corporates.
AXA PPP is acquiring the Simplyhealth PMI office in Bristol as part of the deal and nearly all the 390 employees will transfer to AXA PPP healthcare.
Simplyhealth's PMI business has been operating in the UK for 13 years and employs around 300 people at its Bristol-based office, with others at other Simplyhealth locations, covering over 200,000 people.
Keith Gibbs, chief executive, AXA PPP healthcare said: "With its well balanced, stable book of business, Simplyhealth's PMI business will be an excellent addition to AXA PPP healthcare and this agreement has presented a rare opportunity to acquire complementary business in the UK.
"Both companies share a commitment to offering outstanding customer service, supporting their local communities and being an employer of choice.
"We look forward to working with Simplyhealth and its intermediary partners to ensure a smooth transition providing excellent service and continuing cover for all individual and business customers."
Abdin said: AXA PPP healthcare has a long-term commitment to the PMI market and this sees them acquiring a business with well-aligned values and great customer service standards.
"We are delighted to have found a good home for our customers and people in AXA PPP healthcare."
Abdin said: "This is a pivotal moment in our long history. We are going to focus on everyday healthcare, where we see numerous growth opportunities in services to address the everyday things that stop our customers from making the most of life.
"Problems like back pain, toothache, eyesight difficulty, mobility and independence. This is where demand is rising inexorably. The sale of our PMI business will provide us with funds to accelerate this strategy."
Abdin added: "Our customers know they are going to live longer and they want to make the most of life for as long as possible.
"They tell us they want access to a range of everyday healthcare services, they know the NHS won't provide them all in future and they are prepared to pay for them.
"They want to be more informed and involved in their own healthcare and we will help them."