Highly capitalised new life and annuity reinsurer launched
Bermuda’s newest long-term reinsurer, Martello Re Limited, is backed by major equity partners.
The Class E life and annuity reinsurance company, with initial equity of $1.65 billion, has been launched with the financial support of Massachusetts Mutual Life Insurance Company, Centerbridge Partners, Brown Brothers Harriman, and a group of institutional investors and family offices, including Hudson Structured Capital Management.
Barings and Centerbridge will act as asset managers for Martello Re.
Dennis Ho in Bermuda has been appointed CEO of the new entity.
Through a commitment to long-term financial strength, creative solutions, and unique investment capabilities, Martello Re plans to offer a differentiated value proposition to its counterparties.
The company will initially focus on providing MassMutual and its subsidiaries with reinsurance capacity on current product offerings, after which it will offer its services selectively to other top insurers in the life and annuity space.
MassMutual and its subsidiaries will initially reinsure approximately $14 billion of general account liabilities to Martello Re and also enter into a flow arrangement to reinsure new business.
Both transactions are expected to close in February and have received regulatory approval.
Barings, one of the world's leading investment managers, and Centerbridge, a leading alternative asset manager, will manage Martello Re's investment portfolio and provide access to extensive public and private asset origination and underwriting capabilities across all asset classes.
Roger Crandall, chairman, president and CEO, MassMutual, said: "The launch of Martello Re represents a unique and strategic opportunity for MassMutual that supports our future growth.
“By coming together with established, world-class partners to build a leading reinsurer, we will be able to more efficiently manage risk and deliver on our long-term commitments while providing ongoing value to our policyowners and customers.”
Mike Freno, Barings chairman and CEO, said: "Today's announcement underscores Barings' deep expertise in alternative asset management and insurance.
"We are proud to be teaming with leading firms like MassMutual, Centerbridge Partners and Brown Brothers Harriman to create and support an innovative new player in the reinsurance field."
Centerbridge's co-founder and managing principal Jeff Aronson added: "The creation of Martello Re is ground-breaking for the reinsurance sector.
“We've had a longstanding relationship with MassMutual, Barings, and Brown Brothers Harriman and we couldn't be more grateful for their support in including us in this innovative partnership.
“We also appreciate the support from our clients who participated in the capital raise for Martello Re. We look forward to serving them and Martello Re in helping to create a full-spectrum, industry leading asset management solution for fixed income and private credit."
Jeff Meskin, Brown Brothers Harriman partner and head of BBH Private Banking, said: "We have enjoyed longstanding relationships with Barings, MassMutual, and Centerbridge.
"Joining together with these firms to create Martello Re for the benefit of our wealth management clients will be an exciting journey.
My partner, Taylor Bodman, and I look forward to joining the board of directors and to working with the Martello Re team and our partners to grow this unique reinsurance platform."
Martello Re will be led by Mr Ho, a 22-year industry veteran and life actuary who most recently founded Saturday Insurance, an online insurtech platform.
Prior to founding Saturday, Mr Ho held a range of other leadership roles including CEO for Longitude Re, managing director at BlackRock Solutions, and head of US life insurance solutions at Deutsche Bank.
He said: "This is an ideal time to build a new life reinsurer given the growing consumer demand for retirement products and challenging market environment for insurers.
"Through Martello Re, we've combined the DNA and core values of MassMutual with the agility of a start-up to create a premier reinsurer that will provide the industry with access to a unique combination of product expertise, capital, and investment capabilities that is not currently available today."
Martello Re will be overseen by a board of directors made up of investors and the company’s CEO.
The initial members of the board will include chairwoman Ellen Conlin from MassMutual and Michael Baumstein of Barings, Matthew Kabaker and Eric Hoffman from Centerbridge, Mr Meskin and Mr Bodman from Brown Brothers Harriman, and Mr Ho.