Cigna officially confirmed it will sell off its group life and disability insurance business lines to New York Life Insurance Company in a deal worth $6.3 billion.
The fact that Cigna was looking for a buyer for these business units has been rumored since August. Last week, sources told The Wall Street Journal that New York Life was the frontrunner for the acquisition.
The two companies expect the deal to be finalized in the third quarter of 2020.
"We are proud of what we have achieved in our life and disability business, and the world-class team that powers it," said Matt Manders, Cigna's president of strategy and solutions, in a statement. "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."
Cigna's employees working in these business lines will transfer to New York Life as well, according to the announcement.
Cigna has been solidifying its focus on its health benefits following its acquisition of Express Scripts last year. The insurer has seen a significant financial boost over the past three-quarters thanks in large part to the pharmacy benefit manager's performance.
Reaching a deal to sell its group benefits insurance business could also allow Cigna to pay down some of its debts, which sit at about $39 billion.