Voya Financial, Inc. announced on Tuesday, Oct. 30, that it will stop selling new individual life insurance at the end of the year.
The announcement came as part of the company’s third quarter earnings report, which revealed the company, spun out of ING in 2013, had concluded the strategic review of its individual life business.
The result: Voya will cease all new sales of individual life insurance on Dec. 31, 2018, and will keep its existing block of life insurance policies and pay out claims as they come due.
“Following the sale of substantially all of our individual annuities businesses earlier this year, we conducted a thorough review of our Individual Life business to determine the best path forward. We carefully considered our broader, go-forward strategy of largely focusing on the workplace and institutional clients, analyzed the options available to us, and concluded that ceasing new sales aligns with our plans to focus on our higher-growth, higher-return, capital-light businesses: Retirement, Investment Management and Employee Benefits,” said Voya Financial Chairman and CEO Rodney O. Martin.
“Further, continuing to own the in-force block will benefit shareholders in that it will provide earnings and capital diversification and generate higher free cash flows. Specifically, we expect our Individual Life business to increase free cash flow conversion to 70% to 80% and generate meaningful free cash flow of at least $1 billion over the next five to six years.
“Voya will continue to be good stewards of shareholder capital. As we have over the past several years, we will continue to explore and pursue opportunities to maximize the value of our in-force life insurance business,” Martin said.
For the third quarter, Voya’s total individual life sales totaled $20 million, up from $18 million. The unit has contributed about 20% of operating earnings in recent quarters. As recently as 2012, Voya’s annual individual life insurance sales reached $250 million.
Voya joins MetLife in recently withdrawing from individual life insurance sales. MetLife spun off its U.S. retail life business into Brighthouse Financial in 2017.