New York Life announces strong 2022 financial results underscoring company’s robust strength and stability.
New York Life, America’s largest1 mutual life insurer, today announced strong financial results for 2022 that underscore the power of the company’s differentiated business model and its significant contributions to New York Life’s enduring financial strength. The company’s top-line growth was driven by a new record in annuity sales, making New York Life the industry leader in retail annuity sales for 20222. In addition to posting a company record of nearly $2.9 billion in operating earnings, New York Life records of $16.5 billion in policy owner benefits and dividends paid and $1.2 trillion in individual life insurance in force in the U.S. demonstrate the company’s enduring commitment to the millions of individuals, families, and businesses it serves.
Record $2 billion dividend payout in 2023
New York Life declared a record dividend of $2 billion to eligible participating policy owners in 2023, the largest in company history. Paying a dividend3 for a 169th consecutive year highlights New York Life’s ability to deliver ongoing, long-term value to clients.
“We delivered healthy performance across our diversified portfolio of businesses in 2022. Despite ongoing economic uncertainty, New York Life’s financial strength is as robust as ever and we remain exceptionally well-positioned to manage through any environment,” said Craig DeSanto, CEO & President, New York Life.
Strong surplus and leading financial strength ratings
New York Life’s strong surplus – capital above and beyond the reserves already set aside to pay the benefits the company promises – is a key component of its leading financial strength ratings. New York Life is one of only two life insurers with the highest financial strength ratings currently awarded to any U.S. life insurance company by all four major rating agencies4.
According to Craig DeSanto, “Our financial strength enables us to continue to invest in solutions and tools that help us meet our customers’ evolving needs and position our 12,000 agents and advisors to deliver protection-first advice and guidance.”
Financial performance highlights as of and for the year ended December 31, 2022 include:
$30.1 billion surplus (including the asset valuation reserve) 5
$16.5 billion in total dividends and benefits paid to policy owners6
$2.0 billion total dividend payout declared for 20233
$1.2 trillion of individual life insurance in force in the U.S. 7
$710 billion in assets under management8
$1.7 billion in insurance sales9
$17.7 billion in insurance premiums10
$23.2 billion in annuity sales11
$2.9 billion in operating earnings12
New York Life to acquire Cigna’s group life and disability insurance business
New York Life, America’s largest mutual life insurer, and Cigna, a leading global health service company, announced today that they have entered into a definitive agreement whereby New York Life will acquire Cigna’s group life and disability insurance business for $6.3 billion. The acquisition is expected to close in the third quarter of 2020, subject to applicable regulatory approvals and other customary closing conditions.
“This transaction increases the value we can deliver to our policy owners, strengthens our well-defined business model, and adds millions of customers to the New York Life family,” said New York Life Chairman and CEO Ted Mathas. “Cigna’s group life and disability business enhances our portfolio of strategic businesses and is led by an experienced management team and high-quality workforce, who we look forward to welcoming to our company. We are fully committed to making this transition as seamless as possible for employees and clients alike.”
The group life and disability insurance business will operate within New York Life’s portfolio of strategic businesses, which, like Cigna’s Group Insurance business, are industry leaders, highly profitable, and fully support New York Life’s core retail life insurance franchise. These businesses reinforce New York Life’s overall financial strength by generating capital that can contribute to its surplus, dividends, and earnings, which directly benefits the company’s policy owners. In addition, the Cigna Group Insurance employees, as well as the employees who primarily support the acquired business, will transfer to New York Life.
“We are proud of what we have achieved in our life and disability business, and the world-class team that powers it. We are confident that clients and customers, including the many who also receive health and related benefits through Cigna, will continue to enjoy the high-quality benefits solutions and service for which this business is known,” said Matt Manders, Cigna’s President of Strategy and Solutions.
“Our team is excited to become a part of New York Life and continue to focus on the mission of providing financial security and peace of mind to individuals, families, and businesses across the country while our unwavering commitment to focusing on productivity will continue,” said William Smith, President of Cigna Group Insurance. “We look forward to continuing our relationships with our valued customers and clients. New York Life is a highly-respected brand in our industry and has the capital, commitment, and trust to help us grow and thrive going forward.”
In a multi-year collaboration, following closing, the parties will continue to bring an integrated Health / Group offering to clients and prospects who desire it.
Additional Information
New York Life will pay Cigna cash consideration of $6.3 billion. The transaction is not subject to a financing condition at closing. Cigna expects to realize approximately $5.3 billion of net after-tax proceeds from this transaction. Cigna expects to utilize proceeds of the transaction for share repurchase and repayment of debt in 2020. Cigna’s Board of Directors has increased the company’s share repurchase authority by $3.0 billion to an aggregate amount of $4.0 billion.
Cigna expects the impact of the transaction to be neutral to earnings per share in 2020 and modestly accretive to earnings per share in 2021. Cigna continues to expect to meet its deleveraging commitments made following the Express Scripts combination.
Credit Suisse Securities (USA) LLC is acting as financial advisor and Debevoise & Plimpton LLP is serving as legal advisor to New York Life.
BofA Securities is acting as financial advisor to Cigna. Sidley Austin LLP is serving as lead legal counsel, and Paul, Weiss, Rifkind, Wharton & Garrison LLP is serving as antitrust counsel, to Cigna. Wachtell, Lipton, Rosen & Katz is also advising Cigna on the transaction.