MassMutual Claims The Hartford’s Retirement Business
“Importantly, this is a win-win for both MassMutual and The Hartford’s Retirement Plans business, their clients, distribution partners and employees,” said Sarsynski. “The addition of this business will enable us to broaden and deepen our product offerings and relationships with valued distribution partners. We look forward to welcoming the talented team of professionals at The Hartford’s Retirement Plans business to MassMutual.”
Sarsynski continued: “In addition, clients from The Hartford’s Retirement Plans business will benefit from MassMutual’s industry leadership in many areas, including our participant communication and education programs, comprehensive tools that help plan sponsors and plan participants measure retirement readiness, and award winning customer service. Together, we will create enhanced value for our advisers and plan sponsors, and work collectively toward our goal of helping our participants retire on their own terms.”
The Hartford announced in March a new strategy that would put its Retirement Plans business up for sale (see“The Hartford Puts Retirement on the Block”).
“The agreement marks the second of three planned business sales as we continue to make good progress executing on our strategy. With The Hartford’s sharper focus on its historical strength in insurance underwriting, along with efforts to improve expense efficiencies, increase capital generation and reduce market risks, we are on the right path to deliver greater shareholder value,” said The Hartford’s chairman, president and CEO Liam E. McGee.
The Hartford expects the transaction to have no material impact on its GAAP financial results and to benefit net statutory capital by approximately $600 million, including the ceding commission and a reduction in required risk-based capital, on closing. The estimated GAAP and statutory financial impacts are based on June 30, 2012, values and are subject to change based on final adjustments, market conditions and financial results through closing date. These impacts are expected to be recognized in the quarter in which the transaction closes.
As part of the agreement, The Hartford will continue to sell new retirement plans during a transition period, and MassMutual will assume all expenses and risk for these sales through a reinsurance agreement. Between now and the close of the transaction, there are no planned changes with respect to the day-to-day interactions or processes between The Hartford and its Retirement Plans’ distribution partners, plan sponsors and customers.