Digital is the big prize in The Hartford's Aetna buy
In announcing The Hartford's $1.45 billion acquisition of Aetna’s U.S. group life and disability business, executives for the multiline insurer say that digital capabilities were a key factor in their decision to buy.
Speaking on a conference call with investors, The Hartford chairman and CEO Chris Swift lauded the technology capabilities that come along with the buy.
"Their claim system and some of their digital capabilities are best in class, and as we integrate and use that insight, [we think] makes us a natural buyer," Swift said. The buy "achieves our customer digital enablement objectives and provides a superior claims leave management platform that we will be able to leverage to achieve better claim outcomes."
Specifically, The Hartford identified Aetna's homegrown Workability platform for absence and disability administration platform as an asset. Workability gives The Hartford an integrated platform for claims management, regulatory compliance, reporting and customer service that can be adapted to several other lines of business. The company believes that by getting Workability and other digital assets it can reduces up-front costs it had expected to incur for digital initiatives and eegacy claims and absence management platform enhancements.
"This is an opportunity to create a more distinctive value proposition for our customers and partners," said Doug Elliot, president of The Hartford, on the call.
In addition, Workability's data will be valuable to The Hartford's data and analytics infrastructure. Incorporating more data will allow it to optimize its product mix and find the right markets for its offerings, the company believes.
"We will be able to leverage our data and analytical capabilities across workers comp and group disability claims, which will enhance our competitive advantages and product capabilities," Swift concluded.
Aetna and The Hartford will work together to support their mutual customers, the companies said in a release, with the majority of Aetna employees who work on the line transferring to The Hartford. Aetna will also continue to market the products, under The Hartford brand, to groups through its medical sales team. The deal is expected to close in early November.