Full disclosure - beyond regulators’ requirements - is the best way for life reinsurers to address concerns over their investment portfolios, an industry leader said.

Grant Kvalheim, chief executive officer of Athene, the largest provider of annuities in the United States, praised moves by the Bermuda Monetary to require greater asset transparency.

“I still think, as an industry, there’s more we can do,” Mr Kvalheim said, speaking on a panel at the 2026 BMA Forum.

While the BMA’s move for greater disclosure was a “great step”, he said the goal should be “line-by-line asset disclosure, full transparency”.

“Without that, we let people throw rocks at us and say, ‘Oh, what's behind the curtain? What's really there?’” Mr Kvalheim said.

“And I think we all know we’re running very disciplined asset-liability management, and and the risks that we retain in Bermuda are very much the same as the risk that we retain anywhere else. I think the best way to deal with that is with disclosure and transparency.”

In recent years, regulators in the US have raised concerns about “asset-intensive reinsurance”, which usually involves the transfer of blocks of pensions and annuities from life insurers to reinsurers, who take on the liabilities and associated asset risk.

Some of Bermuda’s life reinsurers, who now have more than $1.5 trillion of assets under management, are owned by or affiliated with private equity firms. Athene, for example, is owned by Apollo.

Regulators, including those in the US, European Union and Japan, have some concerns over the liquidity and valuation of private-credit investments, as well as potential conflict of interests.

In an earlier panel at the BMA Forum, Petra Kielhema, chairwoman of the European Insurance and Occupational Pensions Authority, warned the industry to “be ready for more visibility”.

She added: “More and more the insurance industry is involved in alternative investments that trigger a lot of attention from supervisors, and that means there will be a lot more need for convincing, sometimes even other regulators, that what is happening in the industry is controlled, is managed and is still prudent and in the interest of consumers. It’s happening and it’s going to be more so.”

Asked where Athene might be looking to derisk, Mr Kvalheim said: “Our view has been for several years that we're in a credit cycle that's long in the tooth, and it keeps extending beyond what anybody might have imagined.

“And so we’ve been up in in the capital structures for several years now, buying senior secured tranches, and have a 97 per cent investment grade portfolio.

“We are reducing our exposure to CLOs [collateralised loan obligations] - not really out of credit concerns - the spreads have tightened so much that we just find better relative value elsewhere.

“I think our total portfolio allocation to CLOs declined 3 per cent last year alone. I think it will continue in that way, just out of relative value.”

Athene was established in Bermuda in 2009 and relocated its holding company to the US in 2024. Its reinsurance arm, Athene Life Re is still based on the island.

Mr Kvalheim said it was not an exaggeration to say that “Athene exists because of Bermuda”.

“It made sense for us because of our ability to source capital into this market from jurisdictions that maybe didn’t want to get involved with the US tax nexus; the existence of the insurance ecosystem here, so we could recruit, grow and train people; and the responsiveness of the BMA.

“Bermuda is an example of where a trusted, diligent regulator attracts capital. Because you want to say you're in a jurisdiction that is respected, that has reciprocal status in the US, has Solvency II equivalency in Europe and and that's more than worth the price of admission, so to speak.”

Graham Cox, head of retirement and income solutions at MetLife, the US life insurer with a Bermudian-based reinsurance subsidiary, said Bermuda’s regulatory stability and predictability was an attraction.

“When you're doing a transaction that's going to last literally 30, 40, or 50 years, having a really stable, predictable regime, a view of risk that's similar to our view of risk is really valuable,” Mr Cox said.

Also on the panel was Clemens Jungsthofel, CEO of German reinsurance giant, Hannover Re.

He said Hannover Re had been operating a property-and-casualty business in 2001 and a life reinsurer since 2008.

"The BMA has been absolutely crucial in terms of clarity of regulation, in terms of speed, pragmatism, solution orientation, and having an open dialogue about products that we bring to Bermuda, from different jurisdictions, with different features,“ Mr Jungsthofel said.

"Developing our Financial Solutions business here has been crucial. Therefore it's been a very, very supportive environment. That does not mean the BMA says always yes to everything, but they always have an open and solution-oriented dialogue and very strong governance, and that's really helpful.“

Mr Kvalheim said the industry could do a better job of telling the story of the benefits of annuities that used retirement funds to generate an income for life.

“I think there is a healthy shift in the conversation from ‘I'm using my defined contribution plan to accumulate assets for retirement’ to ‘how do I turn that accumulation into guaranteed lifetime income?’” Mr Kvalheim said.

“We and a lot of other companies now are trying to figure out what is the right product that makes that a reality.”

“The other opportunity is also defined contribution funds are totally misallocated from an asset perspective.”

He added that defined contribution funds were frequently “misallocated“ to indexed equity and bond funds, and could increase their earning capacity through investments in private assets.

“It isn't just about minimising fees,” Mr Kvalheim said. “It should also be about creating risk-adjusted returns. And if you can get a bigger pot of money at the end of the day and give them a guaranteed income solution, I think we'll have something that's great for consumers.”

Mr Cox said education was needed, as many annuity products seemed complex to most people.

“Products need to be simple enough for people to understand and to feel comfortable taking advantage of them,” Mr Cox said.

“It's tough to convince somebody, ‘Hey, give us half of all the money you've saved in your lifetime, and I'll give a little bit back to you each month for as long as you live.’

“That's a really difficult hurdle to get people over, especially if there's not a lot of trust, or transparency or simplicity in the products.”

Taisuke Nishimura, group financial officer, of Daiichi Life Group, said annuities were not very popular in Japan.

"It’s not very attractive in terms of rates, and also, people psychologically don't want to lose assets when they die,“ Mr Nishimura said.

That’s really a psychological barrier. But in Japan the alternative solution from insurance is lifetime medical supplemental product, or a long-term care product.“