AXA Financial (AXA), a member of the global AXA Group, has entered into an agreement to sell a closed book of policies from its MONY Life Insurance Company to Protective Life Corporation (Protective) for $1.06 billion.
Under the terms of the deal, expected to close on Oct. 1, 2013, Protective will reinsure an in-force book of life insurance policies written by MONY’s subsidiary, MONY Life insurance of America (MLOA).
The sale of the closed book of business, underwritten for the most part before 2004, is comprised of 560,000 whole life, term life, variable universal life and universal life policies. Also included will be 61,000 annuity contracts and 42,000 accident and health and other policies.
The deal seems to be a good fit for both parties involved. AXA, which acquired The MONY Group and its subsidiaries in 2004, finds an enthusiastic partner in Protective which views the transaction as a mechanism to produce a stable stream of income for years to come.
The agreement in turn allows AXA to free up capital in the closed books of business in order to remain flexible and facilitate growth initiatives.
Protective has indicated that they plan to retain all positions associated with MONY’s customer service and administrative platform based in Syracuse, N.Y. Protective will also assume responsibility for servicing MONY and in-scope MLOA policies as well as the MONY servicing agreement with AXA Business Services.
The MLOA legal entity and other subsidiaries and distribution networks in the U.S. are outside of the deal. Discretion Winter, a spokesman for AXA, reiterated that AXA’s U.S. distribution will not change.