CUNA Mutual Group announced Aug. 2 that it has entered into a definitive agreement to acquire Assurant’s prearranged funeral insurance and final expense business in the U.S. and Canada, serving more than 2 million consumers—for approximately $1.3 billion.
This investment will enhance the Madison, Wis.-based broad financial services provider’s ability to help ensure middle market consumers have access to solutions that help build financial stability, CUNA Mutual Group said in a statement.
“This acquisition allows us to expand the ways we reach middle-market consumers, helping more people make financial decisions that work for them and their situation,” said Robert N. Trunzo, president and CEO, CUNA Mutual Group. “We will continue to build, buy and create partnerships to bring additional insurance, investment, and technology solutions into our portfolio to support our strategic priorities, protect even more consumers and augment our resources and financial strength.”
Like CUNA Mutual Group, Assurant’s preneed business is focused on protecting consumers and their families with simple, easy to understand products. The preneed business will operate with autonomy at its Rapid City, South Dakota location with limited integration into CUNA Mutual Group’s other business lines or operations. Since preneed solutions are provided to consumers primarily through funeral homes, the company has no plans at this time to offer these services through financial institutions, such as credit unions and banks.
The acquisition provides the opportunity to add a business already at scale as CUNA Mutual Group enters new markets to protect even more consumers. The business brings $6.5 billion of face value in-force and $7 billion in assets. Earnings were nearly as high in 2020 as in 2019 in spite of the impact of the COVID-19 pandemic on insureds’ mortality.
Assurant’s distribution model for preneed and final expense solutions includes a longstanding partnership with the largest funeral home provider in North America and many other funeral home partners and distributors across the U.S. and Canada.
The agreement includes a multiyear extension of the 23-year automobile mechanical repair coverage partnership between the companies.
“Today’s announcement represents a positive outcome for all of our stakeholders and importantly, for our Preneed employees, customers and policyholders, said Assurant President and CEO Alan Colberg. “I am also excited to continue to further strengthen our longtime partnership with CUNA Mutual Group, built upon shared values and aligned culture and commitment to customer excellence.”
Trunzo added, “CUNA Mutual Group remains committed to helping credit unions and other strategic partners excel at reaching and addressing consumers’ needs. Ultimately, we are working to ensure a brighter financial future is accessible to everyone.”
The acquisition is expected to close by the end of the third quarter, subject to applicable regulatory approvals and other customary closing conditions.