iA Monetary to spice up US presence with $170 million deal

Canadian insurance coverage and wealth administration large iA Monetary Group has entered a deal to amass Vericity for US$170 million, a bid that can develop its US presence.

Vericity conducts enterprise by way of two working subsidiaries within the mid-market life insurance coverage area. Constancy Life is an Illinois-based insurance coverage service based in 1896, whereas eFinancial is a direct-to-consumer digital insurance coverage company.

A press launch from iA mentioned funding for the transaction will come from present money readily available. The transfer is projected to cut back the agency’s solvency ratio by round three proportion factors. 

“With this acquisition, we’re including scale to our already well-established and profitable US particular person life insurance coverage enterprise and creating worth for our shareholders by constructing on our core insurance coverage and distribution competencies,” mentioned Mike Stickney, govt vp, chief development officer US operations, co-head of acquisitions. 

Based on Stickney, the addition of Constancy Life will enable iA to pursue “additional development” within the US particular person life insurance coverage market. On the similar time, the eFinancial digital company will assist diversify its distribution capabilities. 

Vericity CEO James Hohmann mentioned the acquisition gives “compelling worth for all of our stockholders and displays the power of our enterprise.”

“We sit up for accelerating our strategic development inside iA as we additional develop the eFinancial platform, the enterprise general, and create new alternatives for our folks and the franchise,” Hohmann added. 

The transaction is anticipated to shut within the first half of 2024, following regulatory approvals in Canada and the US. 

Vericity employs over 400 people and is majority owned by personal funding agency J.C. Flowers & Co.

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