Agam Capital, a New Jersey-based insurance solutions provider, has announced plans to form a joint life and retirement venture with alternative investment firm Värde Partners.
The parties said they have entered an agreement to pursue the acquisition, reinsurance and management of life and retirement businesses globally.
The venture will price and manage insurance products by combining the proprietary insurance solutions platform developed by Agam with the investment management expertise of Värde Partners.
Agam’s platform applies machine learning, predictive data analytics and cloud computing to evaluate and assess complex insurance liabilities, incorporating analytical techniques such as integrating transaction modelling with actuarial cash flows.
In connection with the launch, Värde Partners is seeking initially to invest $500 million in life insurance, annuity, and reinsurance assets that will be support by the joint venture.
“Given the current landscape of historically low interest rates and fundamental regulatory and accounting changes, we believe the opportunity across the $23 trillion life insurance industry is huge,” said Elena Lieskovska, Partner and Head of European Financial Services at Värde Partners.
“Life insurance companies are increasingly seeking risk mitigation solutions for legacy blocks of liabilities with multi-dimensional risks,” she explained. “This is particularly true for complex annuity products, such as those with high guarantees or exposure to certain market risks, which typically attract a higher capital charge.”
“We are excited to expand Värde’s financial services footprint into insurance, and partner with Agam to provide alternative solutions to the industry.”
Agam’s Co-Founders, Avi Katz and Chak Raghunathan also commented: “The need for multi-dimensional solutions to the complex changes facing the life insurance industry has never been greater.”
“Against this backdrop, we believe the combination of Värde Partner’s core strengths in complex transactions together with Agam’s differentiated pALM platform will create a world-class insurance solutions provider,” they continued.
“In particular, the Agam platform is designed to price, analyze and manage complex insurance products with embedded capital market risks and offers creative structures and solutions on a global basis.”