NORTHBROOK, Ill. (AP) -- Allstate is selling one of its life insurance businesses to Resolution Life Holdings Inc. for $600 million.
The sale of Lincoln Benefit Life Co. marks Allstate's exit from the consumer segment served by independent life insurance and annuity agencies, and reduces Allstate Financial's required capital by about $1 billion, the company said.
In addition, Allstate Financial will stop issuing fixed annuities at the end of 2013, and will sell products from outside companies. Fixed annuities are contracts in which companies pay set payments to clients for the life of the contract, typically until the customer dies. Record-low interest rates have made annuity products less profitable for insurance companies.
Thomas Wilson, Allstate's chairman, president and CEO, said the sale will sharpen the company's focus on its Allstate agencies, while still providing its customers with a wide variety of products.
Allstate said it expects the sale to generate proceeds, including tax benefits, of about $785 million. The deal is expected to close by the end of the year.
Lincoln, Neb.-based Lincoln Benefit Life was founded in 1938 and acquired by Allstate in 1984.
Shares of The Allstate Corp. rose 93 cents, nearly 2 percent, to $51.96 in afternoon trading.