STAMFORD, Conn., Jan. 30, 2020 (GLOBE NEWSWIRE) -- Independence Holding Company (NYSE: IHC) today announced its ramping up of initiatives for the tech-enabled and senior market and expansion of its pet insurance distribution channels.
Roy T. K. Thung, Chief Executive Officer of IHC, commented, “As we enter a new decade, we would like to update you as to our focus for 2020 and beyond. In order to maximize our ability to serve consumers seeking pet insurance or supplemental health insurance (whether for seniors or those under age 65), we have reorganized our Specialty Benefits segment into specialty health and pet divisions. The health division is comprised of (i) our traditional distribution through independent agents and national accounts, which we now call Independence Brokerage Group, Inc. (“IBG”) and (ii) our tech-enabled distribution through IHC Specialty Benefits, Inc., our lead generation domains (www.healthinsurance.org, www.medicareresources.org, and www.petplace.com), our investment in a lead generation company, and our transactional websites. The pet division is comprised of PetPartners, Inc. (“PetPartners”), www.petplace.com, www.mypetinsurance.com, and our independent distribution channels. Independence American Insurance Company (“IAIC”), a wholly owned subsidiary of IHC, takes the risk on the pet insurance and many of the specialty health products sold by these divisions, but our agencies also sell life and health products from other insurance companies for which they earn commissions. Our proprietary platforms are designed to support multiple carriers and products, and we are recognized by the industry for our speed to market with innovative new products.
Specialty Health Division. During the past two years, we have successfully invested both our capital and efforts in improving our overall infrastructure, lead generation capabilities, sales automation platforms, and presence in the Direct-to-Consumer (“D2C”) space. These efforts have paid off, especially as it relates to our entry into the senior market arena. The following are the highlights of some of our recent accomplishments and our plan for 2020 and beyond:
Pet Insurance Division. We believe this division will be generating at least $100 million of gross annualized pet insurance premiums by the end of 2020 with accelerating growth beyond. The following are the highlights of some of our recent accomplishments and our plan for 2020 and the future:
In summary, IHC owns several agencies that collectively have a growing block of over $200 million of premiums for IHC’s carriers as well as earning commissions on a significant amount of premiums written with other carriers. We have invested, and will continue to deploy, significant resources to build an infrastructure that: (i) markets to both the senior and non-senior consumers, (ii) offers platforms for both IHC and non-affiliated carrier products, (iii) is readily scalable, and (iv) provides the expertise to bring products to market in a nimble and compliant manner. The work we have completed has positioned us for the ramp up we are now experiencing as well as our anticipated accelerated growth for years to come.
The cost involved in hiring, training and licensing a significant number of new agents for both the call centers and advisors will result in a loss for this division during the first three quarters of this year and will put some pressure on IHC’s earnings from its other operations. However, we expect a significant increase in earnings in the fourth quarter of this year since we estimate that approximately fifty percent of Medicare Advantage and Medicare Supplement business is sold during AEP. The agency’s margin on this business is also significantly better due to higher conversion rates. As we make these investments in our future, we are fortunate that we have significant excess capital, are highly liquid, have no debt, and IAIC continues to produce high margins on its insurance premiums. We will accelerate our scale up in these markets in future years, and by doing so we are confident that that we are driving significant earnings and shareholder value.”
About The IHC Group
Independence Holding Company (NYSE:IHC), formed in 1980, is a holding company that is principally engaged in underwriting, administering and/or distributing group and individual specialty benefit products, including disability, supplemental health, pet, and group life insurance through its subsidiaries (Independence Holding Company and its subsidiaries collectively referred to as “The IHC Group”). The IHC Group consists of three insurance companies (Standard Security Life Insurance Company of New York, Madison National Life Insurance Company, Inc. and Independence American Insurance Company). We also have three agencies: (i) Pet Partners Inc., our pet insurance administrator; (ii) IHC Specialty Benefits, Inc., a technology-driven full-service marketing and distribution company that focuses on small employer and individual consumer products through its call center, advisors, and brokerage channel; and (iii) The INSX Cloud Platform through My1HR, our wholly owned Web Based Entity. IHC also owns the following domains: www.healthedeals.com; www.heathinsurance.org; www.medicareresources.org; and www.petplace.com.
Forward-looking Statements
Certain statements and information contained in this release may be considered “forward-looking statements,” such as statements relating to management's views with respect to future events and financial performance. Such forward-looking statements are subject to risks, uncertainties and other factors that could cause actual results to differ materially from historical experience or from future results expressed or implied by such forward-looking statements. Potential risks and uncertainties include, but are not limited to, economic conditions in the markets in which IHC operates, new federal or state governmental regulation, IHC’s ability to effectively operate, integrate and leverage any past or future strategic acquisition, and other factors which can be found in IHC’s other news releases and filings with the Securities and Exchange Commission. IHC expressly disclaims any duty to update its forward-looking statements unless required by applicable law.
1 The 2018 Annual Report of the Board of Trustees of the Federal Old-Age and Survivors Insurance and Federal Disability Insurance Trust Funds
2 *A.M. Best, Best’s Review, “Agents of Change” January 2017, pages 62, 71:
CONTACT: Loan Nisser
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www.IHCGroup.com