Lincoln Financial Group, a subsidiary of Lincoln National Corporation and its affiliates, has received regulatory approval for its previously announced reinsurance transaction with global multi-line reinsurer, Fortitude Reinsurance Company Ltd.
The transaction will be effective from October 1, 2023, and is expected to close later this month.
According to the terms of the agreement, upon closing Lincoln will cede approximately $28 billion of in-force universal life with secondary guarantees, MoneyGuard® and fixed annuity statutory reserves to Fortitude Re.
Ellen Cooper, Chairman, President and Cheif Executive Officer of Lincoln Financial Group, commented: “This significant milestone is the culmination of months of hard work on behalf of our teams and marks a big step forward in our efforts to de-risk, strengthen the company’s balance sheet and improve ongoing free cash flow.
“We expect economic benefits of this transaction to be in line with what we originally communicated.”
The reinsured block is comprised of roughly $9 billion of ULSG statutory reserves, or about 40% of Lincoln’s total in-force ULSG, nearly $12 billion of MoneyGuard statutory reserves, or about 80% of Lincoln’s total in-force MoneyGuard, and almost $8 billion of fixed annuities statutory reserves, or about 40% of Lincoln’s total in-force fixed annuities.
