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Humana is selling its long-term care subsidiary, KMG America Corporation, to Continental General Insurance Company, a Texas-based company owned by HC2 Holdings.
Humana said it expects to record a net loss associated with the sale of KMG of approximately $400 million. The estimated loss includes a pretax loss of approximately $900 million, offset by the expected tax benefit of approximately $500 million.
Humana's commercial long-term care insurance policies serve approximately 30,100 policyholders. Continental General Insurance Company currently provides long-term care, life and annuity coverage to approximately 93,000 members.
Humana has also announced it is laying off or buying-out 2,700 staffers, or 6 percent of its workforce, for millions in savings.
The layoffs and sale are leading to reported analyst speculation that Humana could be looking for another merger deal.