Reinsurance News

Fortitude Re finalises acquisition of AIG’s legacy insurance businesses

5th January 2022 - Author: Luke Gallin

Fortitude Group Holdings, LLC, the parent of Bermuda-based reinsurer Fortitude Re, has now completed its takeover of AIG’s legacy insurance businesses following the acquisition of Fortitude Life & Annuity Solutions, Inc. (FLAS) and Fortitude P&C Solutions, Inc. (FPCS).

It was announced in late November 2019 that the Carlyle Group and T&D Holdings had partnered to acquire a 76.6% ownership interest in Fortitude Re.

The run-off reinsurer was launched by AIG and Carlyle in 2018.

Following the receipt of regulatory approvals and customary closing conditions, the deal completed in June of 2020 and saw Fortitude Group Holdings launch as an independent provider of run-off management solutions.

Roughly six months later, the final step in Fortitude Re’s acquisition of AIG’s legacy insurance operations has now completed.

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FLAS is comprised of 250 professionals based in Nashville and currently provides policyholder services for roughly four million life insurance policies issued by AIG, of which a slice is reinsured by Fortitude Re.

FPCS comprises 50 professionals based in Jersey City and currently oversees some 5,000 complex casualty claims on policies issued by AIG and reinsured by Fortitude Re.

For legacy firm Fortitude Re, the takeover of FLAS provides it with a highly cost-effective, experienced and scalable administration platform for run-off life and annuity insurance books of business, enabling the company to offer additional transactional flexibility and structural solutions for its counterparties.

The acquisition of FPCS enables the reinsurer to offer proactive casualty claim management services for many employee injury, legacy, environmental, and complex casualty programmes.

James Bracken, Fortitude Re Chief Executive Officer (CEO), commented: “Through our scaled life administration platform, we are well positioned to provide a variety of operating models to our life and annuity insurer clients as they seek to manage their runoff portfolios.

“Our P&C claims team are experts in complex casualty claims and their deep experience can deliver real value and confidence to Fortitude Re’s clients.”

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