Sun Life Financial US recently completed its $2.475 billion acquisition of DentaQuest, the second-largest dental benefits provider in the US by membership. The deal, which closed on June 1, 2022, is expected to bring Sun Life US’s total annual benefits revenues to more than $7 billion.
The financial services giant now serves more than 50 million Americans through its broad portfolio of products and services, which includes disability, absence management, life, dental, vision, voluntary, medical stop-loss, and care navigation. Boosted by its DentaQuest acquisition, Sun Life US is now one of the largest providers of specialty benefits in the country.
“Over the past decade we have transformed the US business from a mostly retail individual life and annuities business to a high-performing market leading benefits business,” said Dan Fishbein, president, Sun Life Financial US. “The DentaQuest acquisition continues this evolution, changing the footprint of our business in the US into a larger, more healthcare-focused organization, now with more than 70% of our benefits revenue coming from healthcare.
“These changes have transitioned Sun Life US from a capital-intensive to a capital-light business with strong cash flow generation; from businesses with long-term risk profiles to mostly short-term risk and fee-based businesses; from slow-growth markets to higher growth markets; and from return on equity (ROE) in the single digits to a return on tangible equity in the high teens.”
Headquartered in Boston and founded in 2001, DentaQuest brought more than 33 million members in 36 states and more than 2,400 employees across to Sun Life US. At the time of acquisition, it was the largest provider of US Medicaid dental benefits, with growing Medicare Advantage, commercial, and US Affordable Care Act (ACA) exchange businesses.
The leadership team for the combined dental benefits business under Sun Life US consists of a blend of DentaQuest and Sun Life leaders, all of whom are focused on growth strategies, revenue synergies, and optimizing performance, according to Fishbein.
“We’re approaching integration with great care and our goal is to realize the full potential of the transaction for all our stakeholders, including providing enhanced offerings for clients, delivering our accretion and cost savings targets for shareholders, creating new opportunities for our employees, and delivering a positive integration experience for all,” he explained.
“We have a strong track record of successfully integrating group benefits businesses, while minimizing disruption for our clients. Many of the leaders who managed the Assurant integration are involved in the DentaQuest integration. We are focused on integration activities that will support our run rate cost savings target of $60 million by 2024. We’re off to a strong start with a fully integrated leadership team, engaged employees, and a detailed plan for the remaining steps.”
Sun Life US announced its second quarter 2022 financial results on August 3, in which it reported insurance sales of $213 million, up 12% year-over-year, driven by higher dental and medical stop-loss sales. The business reported net income of $213 million, up by 36%, or $56 million, from the prior year period, but partially offset by costs related to the DentaQuest acquisition.
When Sun Life first announced the DentaQuest deal, it gave an accretion projection of an additional 42 basis points to underlying ROE in 2022 on an annualized basis. In 2024, upon realization of expense synergies, Sun Life expects the acquisition to add approximately 50 basis points to underlying ROE.
“The underlying earnings for DentaQuest in the one month [June 2022] was $10 million,” said Fishbein. “We’re still confident in the accretion projections that we made when we announced the transaction, and certainly, the results in June would support that. We did see higher margins in June than perhaps we expected, and a little lower revenues, but the higher margins more than made up for the small variance in revenues. Overall […] this first month gives us confidence in our prior projections.”
Fishbein said he’s excited about the future at Sun Life US, adding: “We now have four strong businesses with market leading positions in dental and stop-loss, and a top 10 employee benefits business. Although recent results have been somewhat masked by COVID impacts, once this subsides, we remain confident in achieving our medium-term targets for the US, including 10% or more earnings growth for our benefits businesses.”
Yes, Sun Life Financial offers health plans that include coverage for orthodontic braces for children and adults. Sun Life dental may not cover the entire cost, but it’s a plan that will subsidize a significant percentage of the procedure.
In some cases, Sun Life’s dental plan can cover up to 70% of the cost, with a coverage limit per person that may vary by state.
How much does dental insurance cost?
Dental insurance can vary. The cost can change from provider to provider and state by state.
If you live in California, and depending on the coverage, term, and other policy details, you’ll pay anywhere from $13 to $23 a month for an individual dental plan. The lump sum yearly payment would be around $150 to $255.
Family plans are available from some plan providers. This can cost from $35 a month, or at a lump sum payment of $408 a year.
Read this article to learn more about what should you consider before purchasing dental insurance.
Why are braces so expensive?
Braces are expensive due to the high cost of the materials used. Apart from requiring expensive materials, braces involve a lot of complex and delicate processes. They’re produced in a lab, require preparatory work and must be customized to fit the patient’s teeth.
If the braces are lingual appliances (braces that have the brackets placed behind the teeth), these can be even more costly due to the complex preparation, installation, and fitting process.
Employee benefits company Assurant was acquired by Sun Life in March 2016, making Assurant part of the Sun Life family.
There are many ways to contact Sun Life to make your claims. For Sun Life US, you can call 800-247-6875 Mondays to Fridays, from 8am to 8pm ET.
You can also get in touch with Sun Life via email at [email protected].
How long does Sun Life take to process claims?
In most cases, especially if you have a bank account registered with Sun Life, you can receive the money within two days.
If Sun Life does not have your banking info on file, they can mail you a check.
You must submit a claim within 90 days of the end of the calendar year when the expense was made. For example, if a claim is made any time between January 1 and December 31, 2023, the deadline for submitting that to Sun Life is on March 30, 2024. It’s important that Sun Life receives your claim on or before this date.
You can submit claims via the website, mobile app, or by registered mail.
If you submit your claims by mail, allow 5 to 7 business days for Sun Life to receive it. Sun Life will not reimburse any claims submitted past the deadline.
Can I make a premium payment to Sun Life after the due date?
Yes. Most plans allow you a grace period of 31 days to make up for the missed payment and avoid losing your coverage.
Can I get my money back from my Sun Life plan?
That depends on the terms, features, and conditions of your policy. Some plans allow for a loan from the cash premiums after a minimum of 10 years. Refer to your policy’s provisions or contact your insurance agent to be sure.
If I cancel my life insurance policy, do I get my money back?
No, in most cases. It’s very likely that all your previous payments will be forfeited, and you won’t receive anything. The only exception is when you cancel is a whole life insurance policy, which can give you a lump sum payment.
