ReAssure, the closed life book consolidator specialist unit of global reinsurance firm Swiss Re, is to acquire 1.1 million life insurance policies from Legal & General in a deal worth UK £650 million.
The transaction strengthens ReAssure’s position in the United Kingdon and the firm says it is consistent with its strategy, to acquire and manage other underwriters books of life insurance business.
The 1.1 million life policies, which consist of with-profit, unit-linked and savings products, will be transferred to ReAssure from Legal & General Assurance Society Limited, part of the L&G Group.
Thierry Léger, CEO of Life Capital at Swiss Re, commented on the deal, “We are delighted to have been able to acquire another attractive portfolio in the UK closed book market. This is an excellent fit with our strategy to grow ReAssure in order to create value for shareholders. Swiss Re remains committed to diversify its portfolio by accessing life and health risk pools via alternative channels, and ReAssure provides an excellent platform for growth.”
ReAssure Group will administer the 1.1 million policies once it acquires them from L&G, taking the number of life policies under its management or administration to 4.7 million.
The deal also increases ReAssure assets under management, including investments for unit-linked and with-profit business, by UK £33 billion to approximately UK £77 billion.
Matt Cuhls, CEO of ReAssure, said, “This is an exciting accomplishment that allows us to achieve economies of scale using our proven platform. After the successful integration of Guardian, we are confident in our capability to deliver once again. The UK closed book market is consolidating, and this deal allows us to do what we do best: integration, migration and the delivery of great customer service.”
Swiss Re as a group can put its reinsurance capital to work in the acquisition of these policies, aiming to manage and administer the book of life insurance business more efficiently than its underwriters could, while also benefiting from the significant increase in assets under its management.
These life consolidation platforms allow the owners to then analyse and optimise the business they administer and manage, alongside the rest of their diversified global risk portfolios, so recognising benefits of efficiency across their businesses.
Swiss Re recently took an £800 million investment from Japanese insurance holding company MS&AD Insurance Group Holdings Inc (MS&AD) into UK closed life book consolidator ReAssure.