Omaha, Neb. – (June 17, 2010) HM Life Insurance Company, a subsidiary of Pittsburgh-based HM Insurance Group, has reached an agreement to acquire Mutual of Omaha's employer stop loss line of business, the companies announced.
The transaction is consistent with Mutual of Omaha's strategic decision to focus on its core products. Stop loss insurance is designed to shield employers' self-funded health plans from the impact of catastrophic claims.
"We believe this is a win-win transaction for Mutual of Omaha, our stop loss clients and HM Insurance Group," said Dan Martin, Mutual's Executive Vice President of Group Benefit Services. "It allows Mutual of Omaha to concentrate on continued growth in our core products while giving our clients access to an industry leader in stop loss."
Mutual of Omaha's core products include individual life, long-term care, Medicare supplement insurance and single premium immediate annuities as well as group employer-paid and voluntary life, AD&D and disability.
"This acquisition will strengthen HM's leadership position in the stop loss market," said Michael W. Sullivan, President and COO of HM Insurance Group, a Highmark Company. "The block complements our current stop loss distribution channel, allows us to achieve greater economies of scale and supports our strategic direction as an expert in health risk solutions."
The Mutual of Omaha stop loss block, with approximately $100 million in annual premium, will grow HM's current block of $420 million by nearly 25 percent. Sullivan said, "HM is pleased to acquire this stop loss block. It has performed well and Mutual of Omaha has an outstanding reputation in the marketplace."
HM will maintain a regional office in Omaha staffed with employees transitioned from Mutual's stop loss unit.
The transaction is effective July 1, 2010, following regulatory approvals. The financial terms were not disclosed. Keefe, Bruyette & Woods, Inc. served as financial advisor to Mutual of Omaha in the transaction.
HM Life Insurance Company and HM Life Insurance Company of New York have an "A-" (Excellent) rating from A.M. Best Company. Through its insurance companies, HM Insurance Group holds insurance licenses in 50 states and the District of Columbia and maintains 25 regional sales offices across the country. For more information about HM Insurance Group, visit www.hminsurancegroup.com.
Mutual of Omaha is a full-service, multi-line organization providing insurance, banking and financial products for individuals, businesses and groups throughout the United States. For more information about Mutual of Omaha, visit www.mutualofomaha.com.
