The Prudential Insurance Company of America (PICA), a subsidiary of Prudential Financial, Inc. (PFI), has entered into an inaugural longevity reinsurance arrangement with pension insurer, The Phoenix Group covering U.K. retirees.
PICA has been very active in the global pension de-risking, or longevity re/insurance market since the launch of its longevity reinsurance solution in 2011.
The firm’s most recent and new partnership with Phoenix sees it engage in meaningful collaboration with another significant insurance market participant in the UK marketplace.
With the addition of Phoenix, PICA, alongside its affiliate, Prudential Retirement Insurance and Annuity Company (PRIAC), now offers reinsurance support to pension insurance firms that account for approximately 90% of the annual volume of both buy-ins and buy-outs in the UK.
Justin Grainger, Phoenix Group’s head of Bulk Purchase Annuities, said: “We are delighted to have completed our first longevity reinsurance transaction with PICA. Phoenix views longevity reinsurance as a key risk management tool. This transaction brings further depth to our reinsurer relationships and enhances our ability to offer competitive terms to pension schemes as we continue to develop our de-risking proposition.”
Head of international transactions for Longevity Risk Transfer at PFI’s retirement business, Rohit Mathur, added: “PFI has consistently focused on supporting the entire U.K. pension de-risking market. The addition of Phoenix is a culmination of our efforts over the past several years to do just that.”
“We have invested in our pricing and transaction teams and that is especially important right now as U.K. pension schemes are racing to get risk transfer deals over the line during the six-month Brexit delay. With so much uncertainty on the horizon, we are happy to be in a position to support the robust pipeline of pension buy-ins and buy-outs seeking to be completed while market conditions hold.”