Principal Financial acquires AI-powered Beam Benefits to expand employee benefits

Principal Financial Group has agreed to acquire Beam Benefits, an AI-powered employee benefits company serving more than 25,000 small businesses, as the financial services firm expands its employee benefits offering for small and midsized businesses (SMBs).

The transaction will add Beam's cloud-native technology platform and digital-first benefits capabilities to Principal's existing portfolio. The acquisition is expected to close in the second half of 2026, subject to regulatory approvals and customary closing conditions.

Acquisition strengthens SMB benefits strategy

Principal said Beam Benefits' focus on serving small businesses aligns with its strategy of expanding employee benefits solutions for the SMB segment.

The company currently serves 180,000 employers, offering retirement, employee benefits and business owner solutions.

According to Amy Friedrich, President of Benefits and Protection at Principal, Beam's digital-first operating model and expertise in the small business market will strengthen the company's growth strategy.

Beam brings AI-powered technology and a growing customer base

Beam Benefits offers dental, vision and ancillary insurance products through a cloud-native technology platform with AI at its core.

According to the companies, Beam has experienced rapid growth in the small business segment.

Key business metrics include:

• More than 25,000 small business customers.
• Approximately $175 million in insurance premiums generated during 2025.
• A digital platform supporting AI-powered underwriting, self-service tools and online benefits management.
• Operations across 46 US states and the District of Columbia.

Principal said Beam's technology and customer base will complement its existing employee benefits platform while enhancing the overall customer experience.

Leadership sees long-term growth opportunity

Tolithia Kornweibel, Chief Executive Officer of Beam Benefits, said the company was built to modernise the employee benefits experience through technology while expanding access to benefits for small businesses and their employees.

She said joining Principal represents the next stage in Beam's growth journey as both organisations work to improve access to employee benefits.

Friedrich added Beam's premium volume, scalable digital capabilities and specialist knowledge of the SMB market make it a strong strategic fit for Principal.

Financial outlook remains unchanged

Principal said the acquisition will not change its 2026 capital deployment or earnings per share growth targets.

The company expects the transaction to accelerate premium and fee growth for its Specialty Benefits business to at or above the upper end of its medium-term target range of 5% to 9% in 2027.

Financial advisory roles on the transaction were handled by Perella Weinberg Partners for Principal and Ardea Partners for Beam Benefits. Legal advisers included Skadden, Arps, Slate, Meagher & Flom LLP for Principal and Wilson Sonsini Goodrich & Rosati, P.C. for Beam Benefits.

Expanding technology-driven employee benefits

The acquisition reflects a broader trend across the employee benefits industry, where insurers and financial services firms are investing in AI, automation and digital platforms to improve customer experience and simplify benefits administration.

Beam's AI-powered underwriting capabilities and cloud-native infrastructure are expected to strengthen Principal's technology offering as employers increasingly seek digital, self-service benefits solutions.