Langhorne Re, the global reinsurer targeting large in-force life and annuity blocks launched in 2018 by Reinsurance Group of America (RGA) and RenaissanceRe (RenRe), is being wound down as it failed to complete any deals and its capital commitments expired without renewal, as first reported by our sister publication Artemis.
The plan was for the third-party capital capitalised life and annuity reinsurance joint venture to combine a long-term capital base with underwriting and third-party capital management support from the pair to purchase large in-force life and annuity blocks.
But as reported earlier by Artemis, Langhorne Re seemingly failed to get going, with sources revealing that no transactions were entered into since its launch a little over four years ago.
In early 2020, RGA’s CEO said that a first deal was imminent for the joint venture, and while the firms remained optimistic that it would gain traction heading into 2021, it’s become clear that this failed to happen, and no deal was ever entered.
At the same time, the capital commitments of $780 million at launch, which were raised as equity from a range of third-party investors such as pension funds and life insurers, as well as commitments from both RGA and RenRe, expired at the end of 2022, with investors and and the two reinsurers apparently opting not to pursue with Langhorne Re as a vehicle.
Artemis reports that the equity investments made by the two companies are likely to be returned following the winding down of Langhorne Re.
Sources have also told our ILS-focused sister publication that as part of the winding down, one of the joint ventures underwriting vehicles, Langhorne Reinsurance (Arizona) Ltd., has been sold to American Equity Investment Life Holding Company.
After its launch in 2018, Langhorne Re took over Arizona-based life insurer Zale Life Insurance Company, and planned to use the entity as its main underwriting vehicle for U.S. business. Soon after, it was renamed Langhorne Reinsurance (Arizona) Ltd.
When you consider the expertise of both RGA and RenRe, it is perhaps somewhat of a surprise that this joint venture failed to get off the ground. Further, over the past couple of years, there’s been some notable successes in the life and annuity sidecar space, suggesting that there is appetite for such structures among investors.