Cowdery’s Resolution raises $1.6bn for legacy life insurance investments

Resolution Life, the legacy life insurance investments arm of insurance entrepreneur Clive Cowdery’s Resolution Group, has raised a further $1.6 billion to fund growth through the acquisition and reinsurance of life insurance portfolios.

Resolution Life takes on large books of life insurance business, using acquisitions or reinsurance backed by capital structures supported by institutional investors, channelling returns and profits back to them in the form of dividends.

The company has established a number of permanent capital structures over the years to manage in-force portfolios of life insurance and reinsurance risk, to the benefit of the vehicles investor backers, which include financial institutions, insurance companies, pension plans, sovereign wealth funds and family offices.

The transactions see Resolution Life effectively providing reinsurance for the legacy books of life business, in order to acquire the premium assets and manage them through to the policies conclusion.

The company uses its Bermudian reinsurance platform Resolution Re, as well as platforms in the US and Australiasia to enter into deals with legacy risk holders and now manages around $60 billion of assets globally on behalf of approximately 2.5 million policyholders.

Since 2003, Resolution Life and prior vehicles founded by Clive Cowdery have deployed $16 billion of equity across multiple transactions, the company said.

Sir Clive Cowdery, Resolution Founder and Executive Chairman of Resolution Life, stated, “Resolution Life provides global insurance companies with a specialist partner to help them release capital while honouring the long-term commitments made to policyholders. Our scale, extensive transactional and operating expertise and our strong capital backing from high-quality investors provides insurers, regulators and policyholders with the confidence and certainty they require.”

Resolution Life has now secured commitments of roughly $5 billion since its launch in September 2018.

The company raised $3 billion in late 2019.

Resolution’s strategy and success in capital raising underscores the attractiveness of insurance-linked investment returns, as many of the larger institutional ILS fund investors also back this kind of open and closed life book consolidation vehicles.

It’s another example of institutional capital markets funding being used as reinsurance capital to underwrite deals and acquire portfolios of risk, delivering the insurance-linked returns to backers through an equity-like structure.