MILWAUKEE (AP) — The parent company of Assurant Health said it will sell or shut down the insurer, which has struggled financially since the introduction of the federal Affordable Care Act.
Assurant Health, headquartered in Milwaukee, is expected to report an operating loss of up to $90 million in the first quarter following a loss of $64 million last year. The company specializes in health insurance for small employers and individuals.
Assurant Inc., the parent company based in New York, said that if it is unable to find a buyer, it will not sell health insurance policies in 2016 and will shut down the business, according to the Milwaukee Journal Sentinel (http://bit.ly/1OIQ8Xk ).
The company, which reported $2 billion in revenue last year, has sold health insurance to individuals in 41 states and on 16 marketplaces set up under the Affordable Care Act. It sold health plans to small employers in 34 states.
The Affordable Care Act negated one of Assurant Health's strengths — determining which customers are the best risk. The law bars insurers from turning away customers because of pre-existing health conditions.
"While it is a difficult decision, we believe they would be strong assets for new owners that are focused more exclusively on health care and employee benefits," Alan Colberg, the parent company's president and chief executive officer, said in a statement.
Assurant also said it is exploring the sale of its employee benefits business, which sells dental, short-term and long-term disability, and life insurance.