Record Euro-Bermuda life legacy reinsurance deal
Bermuda-based Resolution Re has entered into a record-setting reinsurance agreement with a leading Swiss insurer.
Resolution Life Group Holdings LP, the Bermuda-based parent of Resolution Re, said that the agreement with Allianz Suisse Lebensversicherungs-Gesellschaft AG transfers a quota share of 80 per cent of the liabilities of Allianz Suisse’s traditional individual life business, made up of endowment and annuity policies (deferred and in payout) relating to coverage for market risks and insurance risks.
The company said that the reinsured business is a closed book of policies that are in run-off, with no new business, and comprises $4.3 billion in total liabilities.
The transaction is said to be the largest European-to-Bermuda life legacy portfolio reinsurance transaction to date.
The company said that the reinsurance transaction has been approved by the Swiss Financial Market Supervisory Authority.
Allianz Suisse will continue to service the reinsured business, while Resolution Re and Allianz Suisse will work in partnership together for the benefit of policyholders and the continued successful management of the reinsured policies, the company said.
Resolution Life said that it previously acquired AMP Life in Australasia, and in the US it acquired Voya Financial Inc’s individual life in-force business as well as recently signed a reinsurance agreement with Lincoln National Corporation.
Combined with the group’s Bermuda reinsurance base, Resolution Life said, it currently manages approximately $60 billion of assets, employs more than 1,500 people and provides services to approximately 2.5 million policyholders.
Earlier this year, Resolution Life said, it completed an approximately $1.6 billion equity capital raise and has significant capital to deploy for future growth transactions.
Steve Hales, the CEO of Resolution Re, said: “We are delighted to have signed this reinsurance agreement with Allianz Suisse, the largest European-to-Bermuda life legacy portfolio reinsurance transaction to date and a great example of our holistic approach to managing biometric and asset risks that demonstrates the strength of Resolution Re’s global reinsurance offering.
“I am proud to be part of the talented, diverse team that has made this happen and thank the Allianz Suisse team for their collaborative and ‘can-do’ approach.”
Chercher Yang, Resolution Life group head of M&A, said: “This transaction was a real partnership between Resolution Life and the Allianz Group teams, working together during a difficult period of lockdown to achieve the inaugural Swiss-to-Bermuda direct reinsurance agreement.
“We believe this is a great example of Resolution Life’s continuing commitment to provide de-risking solutions to primary life insurers globally.”
Remo Cavegn, chief risk officer of Allianz Suisse, said: “This transaction with Resolution Re benefits Allianz Suisse, the Allianz Group and the policyholders we serve by allowing us to de-risk the balance sheet while ensuring we continue to provide our customers with safe, long-term financial stability for the duration of their policies. We believe Resolution Re to be the right partner for Allianz Suisse to jointly protect our customers’ interests.”
Resolution Life is a global life insurance group focusing on the acquisition and management of portfolios of life insurance policies. It has operations in Bermuda, the United Kingdom, United States, Australia and New Zealand.
Resolution Re is licensed as a Class E reinsurer by the Bermuda Monetary Authority. It provides the primary life insurance sector with reinsurance solutions for de-risking legacy life insurance portfolios in mature markets across the world.