Sunlife’s US business grew underlying net income 32% to US$141 million in the third quarter, driven by medical stop-loss and dental. The group’s US Employee Benefits unit was hurt by higher long-term disability claims.
Group-wide, underlying net income rose 9% to C$1.15 billion, while reported net income fell 29% to C$785 million on interest rate impacts and acquisition and restructuring charges.
“Sunlife delivered a solid third quarter, with growth across Canada, Asia, U.S. stop loss, and GreenOak,” said Kevin Strain, president and CEO.
Medical stop-loss delivered double-digit premium growth and better morbidity experience. Dental earnings improved because of lower claims and expenses, though revenue fell. In Employee Benefits, earnings declined because of higher long-term disability claims severity and volumes.
US sales rose 22% to US$333 million. Sunlife credited stop-loss close rates, pricing discipline supported by its risk selection tools and favourable market conditions. Commercial dental sales rose, offset by lower Medicare Advantage sales.
During the quarter, Sunlife added Health Navigator to its disability offering to help members get care sooner, and began working with health technology company Claritev to speed up supplemental health claims for self-funded employers.
Sunlife’s asset management arm grew underlying net income 6% to US$297 million, but MFS Investment Management had net outflows of US$26.9 billion. That included US$22.6 billion from retail investors, which Sunlife attributed to continued outflows from US equity markets. Its alternative asset manager, GreenOak, the new brand for SLC Management, attracted US$4.0 billion of net inflows.
Sunlife also agreed in August to form a partnership with Wilton Re, which will set up Windsor Life Re, a US- and Bermuda-domiciled reinsurer, with GreenOak as lead asset manager. The partnership is expected to launch in the first half of 2027, subject to regulatory approval.
For employee benefits brokers, Sunlife’s results point to a strong stop-loss market where the carrier is winning business while maintaining pricing discipline. The rise in long-term disability claims, however, could lead to tighter disability pricing at 2027 renewals. Brokers placing group disability with Sunlife should prepare clients for that possibility.
