iA Financial Group bolsters US operations with Prosperity Life deal

iA Financial Group bolsters US operations with Prosperity Life deal | Insurance Business Canada

Mergers & Acquisitions

iA Financial Group bolsters US operations with Prosperity Life deal

Two businesses are involved

Mergers & Acquisitions

By
Jonalyn Cueto

iA Financial Group, one of Canada’s leading insurance and wealth management organizations, announced its acquisition of two blocks of business from Prosperity Life Group in the United States.

The transaction involves final expense and term life insurance products issued by S.USA Life Insurance Company, Inc., a subsidiary of Prosperity Life Group.

S.USA is authorized to write life, annuity, and health insurance products in 47 states and the District of Columbia. The acquired blocks of business encompass more than 115,000 policies, generating over $100 million in annual premiums.

According to the company statement, this strategic acquisition will enhance iA Financial Group’s presence and influence in the US insurance market.

In addition to acquiring the insurance blocks, iA Financial Group will extend its product offerings to Prosperity’s distribution network. Prosperity’s network comprises approximately 15,000 sales agents contracted through independent marketing organizations(IMOs).

Around two-thirds of these agents and IMOs already have agreements with American-Amicable Life Insurance Company, an iA subsidiary, to sell iA products. The remaining agents will be invited to enter similar agreements.

The transaction is expected to be accretive from the first year, both on a core and reported basis. The impact on iA Financial Group’s solvency ratio is projected to be minimal, around a one percentage point decrease. Specific financial details of the transaction were not disclosed.

Sean O’Brien, executive vice-president and chief growth officer for US operations at iA Financial Group, expressed optimism about the acquisition.

“This transaction will further increase iA’s strong growth momentum and expand again its presence in the United States. We look forward to welcoming new IMOs and agents and helping them continue to serve their customers well,” O’Brien said.

The completion of the transaction is contingent upon meeting customary closing conditions, including regulatory approvals. The exact timing of the closing remains uncertain.

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