Security Benefit Life and Guggenheim Partners Go On A Buying Spree
This past Sunday evening (August 12th) we were shocked to see headlines overseas in the United Kingdom about a possible sale of Aviva Life USA to Guggenheim Partners. Aviva USA has been a leader in both indexed life and indexed annuities for the past decade and Guggenheim, although highly successful in other arenas of finance, is a fairly new name in the insurance world. However, in just the last 2 years, Guggenheim has made some big waves by buying two fairly weak companies at pennies on the dollar, Security Benefit Life and Equitrust, and have transformed them into serious contenders in the fixed | fixed indexed annuity space.
Today, Security Benefit and Equitrust, Guggenheim’s two insurance affiliates made the press again (twice in one week) for buying Industrial Alliance Insurance U.S. annuity business. According to the Canadian Press, the deal includes $800 million in contract liabilities and related assets.
So a few big questions remain as to why Guggenheim is all of a sudden so interested in buying up all of these insurance companies at a time when even some of the most established carriers are having trouble making decent return on investment? Are they able to make profits when the current annuity players couldn’t? How many do they anticipate acquiring? What are they investing in right now that warrants making these buyouts a strong long (and short term) play?
Stay tuned to find out more.