RGA evaluating next reinsurance sidecar, as Ruby Re to be fully-deployed this year

Reinsurance Group of America (RGA) expects to have its first third-party capitalised life reinsurance sidecar Ruby Re fully-deployed this year and the company is already evaluating a second iteration of the structure, an executive has said.

RGA launched its first reinsurance sidecar vehicle Ruby Re back in December 2023, with the vehicle set to be focused on underwriting U.S. asset-intensive life reinsurance business via the company.

The sidecar had backing from a number of investors, including insurance-linked securities (ILS) specialist Hudson Structured Capital Management at the time of its launch.

With a target to raise $400 million to $500 million of capital, by November 2024 RGA said it had raised a total of $480 million in capital following the close of its second funding round for Ruby Re.

When it launched the sidecar, RGA retroceded a block of $2.5 billion of existing liabilities to Ruby Re.

Cessions continued and by the end of 2025 RGA had a ceded reinsurance coverable of $4.5 billion from the sidecar, which has fallen through 2026 to $4.1 billion as of the end of June the latest reporting from the company shows.

RGA benefits from retrocessional reinsurance efficiencies through the use of third-party investor capital and Ruby Re, while it also earns fee income related to the structure.

By early 2025, RGA executives said that fee income flowing to the company from the Ruby Re life reinsurance sidecar was already meaningful, but noted that it still had around two-thirds of its capital and capacity left to deploy at the time.

Now, during the recent RGA second-quarter earnings call, an executive revealed the goal is to fully-deploy the sidecars capital this year.

Laura Hay, CFO of RGA explained, “As a reminder, third-party capital remains a core element of our capital management strategy.

“It does enhance our flexibility to fund growth and return capital to shareholders while also generating incremental fee income over time. Specific to Ruby Re, we expect to be fully deployed this year.”

Demonstrating that the life reinsurer has appreciated the source of incremental capital that a sidecar strategy has provided, Hay also noted that future sidecars are already planned.

“We are evaluating options and structures for our next sidecar vehicle,’ Hay explained, adding, “Which we’ll provide more updates on when appropriate.”

RGA CEO Tony Cheng also highlighted third-party capital as an important lever for the life reinsurance company, saying, “We are optimising our balance sheet through in-force liability management, better risk-adjusted investment returns and both internal and third-party capital sources.”

The company is likely to explore avenues for making the benefits of any second reinsurance sidecar even more meaningful, through any second iteration.

Previously RGA said that with these types of third-party capital strategies it’s important to ensure alignment is strong across all parties involved, while trade-offs between a sidecar strategy and simply trading with traditional reinsurers must also be assessed.

In the last twelve months we’ve reported on a number of new life and annuity reinsurance sidecar launches.

F&G launched Fort Green Reinsurance in partnership with Blackstone in August 2025, while Fortitude Re and Carlyle partnered on the launch of the Fortitude Carlyle Asia Reinsurance Ltd. (FCA Re) sidecar in October 2025 and most recently Talcott Financial launched its West Grove Re Ltd. sidecar vehicle earlier this month in partnership with Goldman Sachs.

We also reported recently that AM Best had said that strong U.S. annuity sales have driven a surge in reinsurance sidecar formations in recent years, resulting in rising premiums being ceded to the third-party capitalised structures.

You can read all about the many reinsurance sidecar investments and transactions over the history of the ILS market, including life and annuity vehicles, by visiting our comprehensive list of collateralized reinsurance sidecars transactions.