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05:00 PM BWProvident American Corporation to Sell Insurance Subsidiary in Continued Strategic Shiftto Its Online Venture -- HealthAxis.com November 12, 1998 05:00 PM NORRISTOWN, Pa.--(BUSINESS WIRE)--Nov. 12, 1998--
Selling Provident American Life and Health Insurance Company to Central Reserve Life Corporation
Provident American Corporation PAMC announced today that it has reached an agreement to sell an insurance subsidiary to further facilitate the Company's strategic shift to its online health insurance venture, HealthAxis.com. Under the sales agreement, the Company will sell all of the common stock of Provident American Life and Health Insurance Company to Central Reserve Life Insurance Company, a subsidiary of Central Reserve Life Corporation CRLC , for approximately $5 million. Central Reserve Life, in conjunction with the Reassurance Company of Hannover, will assume through reinsurance all of the individual and small group heath insurance currently in force through Provident American Corporation's subsidiaries for a ceding commission payment to Provident American Corporation of approximately $10 million. The purchase and reinsurance are expected to be completed on or before January 1, 1999, and are subject to regulatory approvals. The agreement calls for Central Reserve Life to provide health products for Internet sales through HealthAxis.com for a three-year period, and Provident Indemnity Life may reinsure up to 50% of the risk. Central Reserve Life also will work to develop additional health insurance products for sale through HealthAxis.com. As a pioneer in the electronic distribution of health insurance, HealthAxis.com will offer Internet consumers a full range of insurance products, including health insurance for individuals and small groups, dental insurance, vision care insurance, prescription coverage, critical care and long-term care insurance. HealthAxis.com also will provide product and health information, instant price quotes, online billing, claim status, and policy or personal information changes and a customer hotline. "We are delighted to have reached this sale agreement that continues our strategic shift to our online health insurance venture, HealthAxis.com," said Alvin H. Clemens, Chairman and Chief Executive Officer of Provident American Corporation. "We look forward to working with Central Reserve Life to develop cutting-edge consumer products for HealthAxis.com."
About Provident American Corporation
The Provident American Corporation is an insurance holding company specializing in the marketing of unique and affordable healthcare and life policies to individuals and small businesses, a $75 billion annual premium market.
About HealthAxis.com
HealthAxis.com, a subsidiary of Provident American Corporation, is a pioneer in the electronic distribution of health insurance to the individual and small group markets. Through its interactive, user-friendly Web site, healthaxis.com, HealthAxis.com will provide customers with access to and the ability to purchase a full range of high quality, flexible insurance products and services at very competitive prices. Safe Harbor Statement under the Private Securities Litigation Reform Act of 1995: Certain statements made by the Companies which are not historical facts may be considered forward-looking statements, including, without limitation, statements as to trends, management's beliefs, expectations and opinions, which are based upon a number of assumptions concerning future conditions that ultimately may prove to be inaccurate. Such forward-looking statements are subject to risks and uncertainties and may be affected by various factors which may cause actual results to differ materially from those in the forward-looking statements. For further information which could cause actual results to differ from the Companies' expectations as well as other factors which could affect the Companies' financial statements, please refer to the Companies' reports filed with the Securities and Exchange Commission. |
