A subsidiary of Zurich Insurance Group has entered into a $2.3 billion reinsurance arrangement on a closed book of annuities with Reinsurance Group of America.
The recently announced transaction saw Farmers New World Life, a subsidiary of Zurich, enter into an agreement with Reinsurance Group of America to reinsure a portion of its closed U.S. annuity book.
The transaction represents reserves of roughly $2.3 billion, and Zurich said the deal reflects the firms continued efforts to reduce its tail risk, make better use of its capital and enhance its profitability.
George Quinn, Group Chief Financial Officer at Zurich commented; “The transaction with Reinsurance Group of America is another example of how the Group actively manages its capital and sharpens its business profile. This transaction reduces risk and continues the process of simplifying the group and releasing capital from non core activities as communicated at the time of our investor day in 2016.”
Farmers New World Life will continue to service and administer the policies which will now be backed by RGA’s reinsurance capital.