Reinsurance News
Longevity reinsurance
Longevity reinsurance is typically used to transfer the financial risk that cohorts of pensioners or annuitants live longer than expected from an insurer or pension scheme to a reinsurer.
Longevity reinsurance is often arranged as indexed arrangements, or in longevity swap formats, as well as through indemnity coverage.
Read our longevity reinsurance news below.
Aon confident of resurgent longevity swap market
18th May 2018
Following their role as lead transaction advisor for Zurich’s recent longevity swap, covering more than £2 billion of the pensioner liabilities of the National Grid Electricity Group of the Electricity Supply Pension Scheme (ESPS), Aon believes that the longevity swap market is back in business. The transaction, which we covered ... Read the full article
Zurich completes £2bn longevity risk transfer deal with UK’s National Grid
15th May 2018
Zurich Insurance Group has completed an intermediated longevity swap deal that covers more than £2 billion of pensioner liabilities for the UK’s National Grid Electricity Group of the Electricity Supply Pension Scheme (ESPS). The transaction, which represents Zurich’s largest ever longevity swap arrangement, will protect the National Grid against the risk ... Read the full article
Prudential & PIC in sixth longevity reinsurance transaction
9th May 2018
As demand for pension de-risking continues to surge, Prudential Retirement, a division of Prudential Financial, Inc., has entered into its sixth longevity reinsurance agreement with Pension Insurance Corporation plc (PIC). The latest deal between the pair sees the Prudential Insurance Company of America (PICA) assume the longevity risk for £900 million ... Read the full article
Bank of England wants more longevity risk retained, less reinsured
27th April 2018
The Bank of England would like to see more longevity risk being retained and less being transferred offshore through reinsurance arrangements, leading it to explore amending Solvency II risk charges to encourage greater retention. The Bank of England's Prudential Regulation Authority (PRA) has before discussed its concerns over the use of ... Read the full article
Risk settlement market remains promising in 2018: Aon
11th April 2018
Aon has reported that the risk settlement market presents many attractive opportunities for re/insurers in 2018, with the strong pricing seen in 2017 expected to continue throughout the coming year. The projection was part of Aon’s ‘Risk Settlement Market 2018’ report, which analysed 2017’s market trends and generated predictions for the ... Read the full article
Prudential collaborates with PIC to de-risk small pensions
4th April 2018
Prudential Retirement, a unit of Prudential Finance, Inc., and Pension Insurance Corporation (PIC) have collaborated on a new approach to expedite longevity reinsurance transactions on smaller pension buy-ins and buy-outs. The partnership will allow PIC to more efficiently address the risk transfer needs of small pensions by combining an advance commitment ... Read the full article
UK pension scheme liabilities could be reduced by up to 1% with CMI 2017: Aon
8th March 2018
The new Continuous Mortality Investigation (CMI) model, CMI 2017, could reduce a pension scheme’s liabilities by between 0.5% and 1%, compared with the previous version of the model CMI 2016, according to Aon estimates. The 2017 CMI model is adjusted to include lower than expected levels of mortality improvement in England ... Read the full article
UK life insurers’ longevity risk could spur life reinsurance demand: S&P
27th February 2018
UK life insurers are facing material longevity risks as the sector undergoes significant change leading to increased diversification of business and products and spurring demand for longevity reinsurance uptake, according to a recent S&P report. "Historical sales of individual annuities mean that longevity risk will still be material in the future. "However, ... Read the full article
Prudential Financial & Scottish Widows reach $1.8 bn longevity reinsurance deal
5th February 2018
Prudential Financial company, the Prudential Insurance Company of America (PICA), and Scottish Widows, a subsidiary of Lloyd's Banking Group, have agreed on a longevity reinsurance agreement in which PICA will assume longevity risk for approximately $1.8 billion of Scottish Widows annuity liabilities. David Lang, Prudential’s lead negotiator for the transaction, said; ... Read the full article
2018 poised to become most active year ever for bulk annuity transactions: Mercer
24th January 2018
Mercer advises sponsors of defined benefit plans to start preparing for any potential de-risking transactions as soon as possible, with 2018 expected to be a very active year for the bulk annuity and longevity swap market. According to consultancy Mercer, 2018 is poised to become the most active year ever for ... Read the full article
PartnerRe and PIC enter £725mn longevity reinsurance deal
22nd January 2018
Specialist pension funds insurer Pension Insurance Corporation (PIC) has announced a £725 million longevity reinsurance agreement with Bermudian reinsurer, PartnerRe. The deal covers the longevity risk acquired when PIC insured the Dockworkers Pension Fund in a full buy-in, in November last year. Kevin O’Regan, Head of Longevity and Portfolio Reinsurance at PartnerRe, ... Read the full article
Aon secured £900mn reinsurance protection for LV=/RGA transaction
15th January 2018
Global insurance and reinsurance brokerage, Aon, recently secured £900 million in reinsurance protection for London Victoria Friendly Society's (LV=) asset and longevity risk transaction. Reinsurance News discussed the £900 million deal between Reinsurance Group of America (RGA) and LV= when it was announced in December 2017, and Aon has now ... Read the full article
Prudential & Legal & General conclude $800m longevity reinsurance deal
21st December 2017
The Prudential Retirement Insurance and Annuity Company (PRIAC), a Prudential Financial unit, has concluded a reinsurance agreement which will see it assume longevity risk for about $800 million in pension liabilities, which are held by Legal & General as part of its bulk annuity business. This transaction covers more than 2,000 ... Read the full article
RGA in £900mn asset and longevity transaction with LV=
19th December 2017
Global, U.S.-based life reinsurance company, Reinsurance Group of America, Incorporated (RGA), has completed a £900 million (US$1.2bn) asset and longevity risk transaction with Liverpool Victoria Friendly Society (LV=). The transaction sees RGA reinsure roughly £900 million in individual annuity business, while no additional terms of the transaction are being disclosed. Executive Vice President ... Read the full article
Reinsurance reduces operational costs for life insurers: Swiss Re
13th December 2017
To improve profitability and value of life insurance products, life insurers have been effectively leveraging reinsurance and capital markets by transferring longevity risk exposures, according to Swiss Re's latest sigma report. Reinsurance and capital market solutions have made life insurers more competitive, improving profitability through reducing mortality, morbidity and longevity risk ... Read the full article
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