Allstate to Sell Life Insurance Unit to Blackstone for $2.8 Billion

“We’re pleased to enter into this transaction as Blackstone continues growing its insurance business,” said Gilles Dellaert, global head of Blackstone Insurance Solutions, in a statement.

Financial firms have been on a tear buying up life insurance and annuities businesses. Last week, Sixth Street Partners announced a deal to buy life insurance business Talcott Resolution for $2 billion.

Since the world-wide financial crisis of 2008, private-equity, asset-management and other types of financial firms have bought up blocks of life-insurance policies and annuities, and even entire operating units, as insurers narrowed their focus and divested product lines. Ultralow interest rates have prompted much of the activity, hurting insurers’ profits.

Allstate said the life insurance unit had a net loss of $23 million in the first nine months of 2020.

In many deals involving financial buyers, the newcomers aim to profit from investment-management fees and by savvy investments of the premiums paid by customers. Many deals have involved a basic savings product known as a fixed annuity, akin to a bank certificate of deposit.

—Leslie Scism contributed to this article.

Write to Josh Beckerman at [email protected]