Term Life Insurance Articles
ING Group Sells Business Unit To Rga
2009-10-23
The ING Group, which has its hand in several investment areas in the U.S., has sold its reinsurance business, ING Reinsurance U.S., to Reinsurance Group of America (RGA). RGA is a U.S.-based global provider of life reinsurance. This sale ultimately involves ING ridding itself of the ability to sell various forms of reinsurance. The deal comes in the wake of 31 states adopting laws governing the sale of life insurance, most recently California. The laws have made it difficult for some companies to make a profit doing so without focusing much attention to the requirements set by these laws. For that reason, ING felt that the best interests of the company would be better served by selling the reinsurance business unit in order to focus on the life insurance aspect of ING, among other things.
The law in California, Senate Bill 98, is very strict on who can sell life insurance, how they can sell it and what kinds of licensing and training the seller must have. With that in mind, ING realized it needed to have the time to attend to these requirements, not only for the company, but also for its policyholders. Therefore it made business sense to pass the ownership of the reinsurance unit off to a company that had more experience and time to focus on the sale of reinsurance in these states. The law will definitely not affect the ability of people in California to get life insurance, specifically to get term life insurance. On the contrary, by making sure life insurance companies like ING have set standards when selling insurance, it will be easier for policyholders to find reliable life insurance coverage.
Another benefit of this deal for ING is that selling ING Reinsurance U.S. means money in the bank to help offset debt and other operating costs they have incurred during the economic recession - another primary reason for the sale. Some of the strongest companies right now are only strong because they cut back and made themselves lean. By doing that they are better able to weather any financial storms that came their way. "This transaction fits within ING's Back to Basics strategy to simplify our structure and focus our U.S. insurance operations on Retirement Services, Life Insurance and Rollover Annuities," said Tom McInerney, CEO for ING Insurance Americas. "We believe that RGA will be an excellent owner of ING Reinsurance." ING's decision to sell its business unit, effectively cutting itself out of the life insurance and term life insurance business, is aimed at strengthening itself as a company overall.
In all areas, this deal makes the most sense financially for both ING and RGA.
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The ING Group, which has its hand in several investment areas in the U.S., has sold its reinsurance business, ING Reinsurance U.S., to Reinsurance Group of America (RGA). RGA is a U.S.-based global provider of life reinsurance. This sale ultimately involves ING ridding itself of the ability to sell various forms of reinsurance. The deal comes in the wake of 31 states adopting laws governing the sale of life insurance, most recently California. The laws have made it difficult for some companies to make a profit doing so without focusing much attention to the requirements set by these laws. For that reason, ING felt that the best interests of the company would be better served by selling the reinsurance business unit in order to focus on the life insurance aspect of ING, among other things.
The law in California, Senate Bill 98, is very strict on who can sell life insurance, how they can sell it and what kinds of licensing and training the seller must have. With that in mind, ING realized it needed to have the time to attend to these requirements, not only for the company, but also for its policyholders. Therefore it made business sense to pass the ownership of the reinsurance unit off to a company that had more experience and time to focus on the sale of reinsurance in these states. The law will definitely not affect the ability of people in California to get life insurance, specifically to get term life insurance. On the contrary, by making sure life insurance companies like ING have set standards when selling insurance, it will be easier for policyholders to find reliable life insurance coverage.
Another benefit of this deal for ING is that selling ING Reinsurance U.S. means money in the bank to help offset debt and other operating costs they have incurred during the economic recession - another primary reason for the sale. Some of the strongest companies right now are only strong because they cut back and made themselves lean. By doing that they are better able to weather any financial storms that came their way. "This transaction fits within ING's Back to Basics strategy to simplify our structure and focus our U.S. insurance operations on Retirement Services, Life Insurance and Rollover Annuities," said Tom McInerney, CEO for ING Insurance Americas. "We believe that RGA will be an excellent owner of ING Reinsurance." ING's decision to sell its business unit, effectively cutting itself out of the life insurance and term life insurance business, is aimed at strengthening itself as a company overall.
In all areas, this deal makes the most sense financially for both ING and RGA.
