longevity risk transfer

Aon was the broker behind the placement of a £900 million asset and longevity risk transfer arrangement for UK insurer Liverpool Victoria (LV=), which saw Reinsurance Group of America (RGA) assuming the risks from a portfolio of LV=’s annuity business.

Reinsurance Group of America (RGA) has completed a £900 million reinsurance transaction covering a portfolio of annuity business from UK insurer Liverpool Victoria (LV=), in a deal that saw both the asset and longevity risk transferred.

Prudential Retirement, a division of Prudential Financial, Inc., has entered into its sixth longevity reinsurance agreement since 2014 with Legal & General (L&G), covering $800 million (£600mn) of its pension liabilities against longevity risks.

NN Life, part of the Nationale-Nederlanden (NN Group), has entered into an index-based longevity hedge transaction with reinsurance firm Hannover Re, in a deal covering the insurer against longevity trend risk associated with around EUR 3 billion of its liabilities.

The cost of entering into longevity risk transfer and reinsurance arrangements is at a historical low, according to Amy Kessler, Head of Longevity Risk Transfer at Prudential Financial, as lower-than-expected longevity improvements feed through into the cost of capacity.

Prudential Retirement is providing reinsurance to assume $1.2 billion of longevity risk from Pension Insurance Corporation (PIC), the fifth such transaction the pair have entered into since 2015, with now around $5 billion of longevity risk reinsured between the pair.

Robus Group, the insurance management, fiduciary and financial management group, has added longevity swap and risk transfer expertise in Guernsey, hiring David Riley who was previously with Marsh captive management as a risk consultant.

Insurance and reinsurance management solutions provider Artex Risk Solutions (Artex) said today that it is administering the Guernsey based insurance vehicle set up by the British Airways Pension Scheme (APS) for its recent longevity swap and reinsurance transaction.

UK life insurer Zurich Assurance Ltd. is looking to enhance its view of longevity risk so it can better manage and transfer exposures accumulated through insurance products sold to pension funds, with the help of risk modelling firm RMS and its Longevity Risk Model.

Availability of reinsurance capacity and access to it is increasingly important in a longevity risk transfer market, where pension and insurer appetite to offload longevity risks keeps increasing, but reinsurance capacity and pricing can sometimes be constrained.