New York Life Completes Acquisition of Cigna's Group Life and Disability Insurance Business
New York Life, America's largest mutual life insurer1, today announced the completion of the company's acquisition of Cigna's group life, accident, and disability insurance business. The $6.3 billion acquisition, which was first announced on December 18, 2019, adds approximately 3,000 employees, over nine million customers2, and enhances New York Life's portfolio of strategic businesses, which support the core retail life insurance franchise and bolster the company's financial strength. The new business will be rebranded New York Life Group Benefit Solutions.
"This acquisition, the largest in our company's history, reinforces our financial strength by generating capital that can contribute to our surplus, dividends, and earnings," said New York Life Chairman and CEO Ted Mathas. "We are excited to welcome to New York Life our new employees and the millions of new customer relationships that we will gain through this milestone transaction. We look forward to building on our leading group benefit solutions market position in the years ahead."
"New York Life Group Benefit Solutions brings deep expertise, differentiated underwriting and risk management capabilities, and extensive consultative experience to New York Life. Our mission is to provide financial peace of mind to those we serve and, together, we will maintain our unwavering focus on and commitment to clients, producers, customers, and our employees," said William J. Smith, senior vice president and head of New York Life Group Benefit Solutions.
New York Life President Craig DeSanto added, "Industry-leading New York Life Group Benefit Solutions is an ideal fit for our company, with a strong management team and talented workforce. We look forward to adding New York Life Group Benefit Solutions' complementary suite of benefits and services to our offerings and growing together in the future. With this acquisition, New York Life is even more strongly positioned to continue to deliver financial security to individuals, families, and business owners."
New York Life and Cigna have also entered into a multi-year collaboration that will continue to bring differentiated, integrated health and group benefit solutions for clients and prospects who desire them.
New York Life Group Benefit Solutions will operate within New York Life's portfolio of strategic businesses, which includes Group Membership Association, Institutional Annuities, Institutional Life, New York Life Direct, and Seguros Monterrey New York Life, among others.
With the completion of the acquisition, New York Life is now a top five insurer across group life, accident, and disability insurance3.
Credit Suisse Securities (USA) LLC acted as financial advisor and Debevoise & Plimpton LLP acted as legal advisor to New York Life.
Bank of America Securities acted as financial advisor to Cigna. Sidley Austin LLP served as lead legal counsel, and Paul, Weiss, Rifkind, Wharton & Garrison LLP served as antitrust counsel, to Cigna. Wachtell, Lipton, Rosen & Katz also advised Cigna on the transaction.
About New York Life
New York Life Group Benefit Solutions products and services are provided exclusively by or through Life Insurance Company of North America ("LINA") or Cigna Life Insurance Company of New York (New York, NY) ("CLICNY"), or by or through affiliates or subsidiaries of Cigna Corporation and reinsured by LINA. LINA and CLICNY are responsible for their own financial condition and contractual obligations.
*Based on revenue as reported by "Fortune 500 ranked within Industries, Insurance: Life, Health (Mutual)," Fortune magazine, 5/18/2020. For methodology, please see http://fortune.com/fortune500/.
**Individual independent rating agency commentary as of 10/15/2020: A.M. Best (A++), Fitch (AAA), Moody's Investors Service (Aaa), Standard & Poor's (AA+).
Cigna Forward Looking Statements
Forward-looking statements are subject to risks and uncertainties, both known and unknown, that could cause actual results to differ materially from those expressed or implied in forward-looking statements. Such risks and uncertainties include, but are not limited to: our ability to achieve our financial, strategic and operational plans or initiatives; our ability to predict and manage medical and pharmacy costs and price effectively; our ability to adapt to changes or trends in an evolving and rapidly changing industry; our ability to effectively differentiate our products and services from those of our competitors and maintain or increase market share; our ability to develop and maintain good relationships with physicians, hospitals, other health care providers, producers, consultants, and pharmaceutical manufacturers; changes in the pharmacy provider marketplace or pharmacy networks; changes in drug pricing; the impact of modifications to our operations and processes; our ability to identify potential strategic transactions and realize the expected benefits (including anticipated synergies) of such transactions in full or within the anticipated time frame, including with respect to the Merger and the sale of our Group Disability and Life business, as well as our ability to integrate or separate operations, resources and systems; the substantial level of government regulation over our business and the potential effects of new laws or regulations or changes in existing laws or regulations; the outcome of litigation, regulatory audits, investigations, actions or guaranty fund assessments; uncertainties surrounding participation in government-sponsored programs such as Medicare; the effectiveness and security of our information technology and other business systems and those of our key suppliers or other third parties; the impact of our debt service obligations on the availability of funds for other business purposes; unfavorable industry, economic or political conditions, including foreign currency movements; acts of civil unrest, war, terrorism, natural disasters or pandemics; reinsurance credit risk; the scale and scope of the COVID-19 pandemic and its potential impact on our business, operating results, cash flows and financial condition, as well as on our employees, clients, customers, suppliers and partners and on the U.S. and global economies; as well as more specific risks and uncertainties discussed in our most recent report on Form 10-K, our Form 10-Q for the quarter ended March 31, 2020 and subsequent reports on Forms 10-Q and 8-K available through the Investor Relations section of www.cigna.com. You should not place undue reliance on forward-looking statements, which speak only as of the date they are made, are not guarantees of future performance or results, and are subject to risks, uncertainties and assumptions that are difficult to predict or quantify. Cigna undertakes no obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise, except as may be required by law.
1Based solely on New York Life's revenue as reported by "Fortune 500 ranked within Industries, Insurance: Life, Health (Mutual)," Fortune magazine, 5/18/2020. For methodology, please see http://fortune.com/fortune500/.
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