Groupama has seen its healthcare business revenues grow over the first six months of the year and further discussed its decision, announced this week, to sell the business.
It cited the importance of significant scale required to compete in the highly competitive SME market and lack of desire to fund external growth.
Groupama saw a 3% growth in private medical insurance (PMI) revenues and continued the trend from last year, although at half the previous rate.
Health insurance brokers have voiced their extreme disappointment and concerns at the sale of the business which sees the market lose another provider.
Commenting further on the decision to sell its healthcare arm to Simplyhealth, François-Xavier Boisseau, CEO of Groupama Insurances, explained: "Following a strategic review earlier in the year, we have exchanged contracts for the sale of our Healthcare business and business operations to Simplyhealth.
"Subject to completion of the necessary legal transfer and regulatory approval we anticipate this being completed over the next 3-6 months.
"Over the first half of the year, Groupama Healthcare's award winning reputation for consistent, high quality service continued to serve us well and win us valuable new opportunities.
"However, competition in the market for SME business remains very strong and we believe that scale has become an even more important factor in being able to compete effectively.
"As we do not wish to invest in achieving external growth, the sensible decision is to divest our healthcare business and operations to an organisation with the necessary aspirations for growth in the UK's Healthcare market and one that can build on the progress that we have made," he added.
Overall, profits in Groupama's combined UK operations increased 34% to £18.5m (from £13.7m in 2010) before tax and amortization.
