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Sun Life (SLF) Expands Stop Loss Business With Independence

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Sun Life Financial Inc. (SLF - Free Report) recently collaborated with Independence Blue Cross to become the exclusive provider of stop loss insurance for its customers. Self-funded employers who are at risk of higher-than-expected health claims will benefit from this partnership.

This move bodes well for Sun Life as diversifying its revenue base will help it navigate ongoing inflationary headwinds. Sun Life aims to enhance its offerings by extending further into the health and benefits business. This collaboration is expected to aid the health and benefits of the U.S. segment, which contributed 70% to the total revenues in 2022. The company’s acquisition of DentaQuest helped this segment gain traction.

Sun Life is the biggest independent stop loss provider in the United States. Improving margins in the stop loss business arising from dropping loss ratios should continue to aid bottom-line results in the future. SLF will provide Independence’s self-funded employers to manage high costs of care without compromising on the health coverage of their employees.

Sun Life will provide customized solutions with affordable pricing and lower fees for Independence’s clients. The company will also provide cash flow solutions which will help pay claims in a hassle-free way. More program features will be launched as Independence makes Sun Life its exclusive stop-loss partner.

Zacks Rank & Price Performance

Sun Life currently carries a Zacks Rank #3 (Hold). Shares of SLF have gained 11.5% in the past year compared with the industry’s rise of 10.4%.

Zacks Investment Research
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Stocks to Consider

Some better-ranked stocks from the Life insurance industry are American Equity Investment Life Holding Company Manulife Financial Corporation (MFC - Free Report) and Primerica, Inc. (PRI - Free Report) . Each of these companies presently carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

American Equity’s bottom line outpaced estimates in three of the trailing four quarters and missed once. The average earnings surprise is 13%.

The Zacks Consensus Estimate for AEL’s 2023 earnings indicates a 72.8% rise. The Zacks Consensus Estimate for AEL’s 2023 revenues is pegged at $2.2 billion.

Manulife Financial’s bottom line outpaced estimates in three of the trailing four quarters and missed once. The average earnings surprise is 1.6%.

The Zacks Consensus Estimate for MFC’s 2023 earnings indicates a 2.5% rise, while the same for revenues suggests 4.5% growth from the prior-year reported figures.

The bottom line of Primerica outpaced the Zacks Consensus Estimate in three of the last four quarters and missed once, the average surprise being 3.8%.

The Zacks Consensus Estimate for PRI’s 2023 earnings indicates a 34% rise, while the same for revenues suggests 4.5% growth from the prior-year reported figures.


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