Pension Corp. in £1.6bn longevity reinsurance deal
Tuesday, 06 30 2015, Category: Insurance and Reinsurance, Country: World
Pension Insurance Corporation (PIC) has entered into a £1.6 billion longevity reinsurance transaction with the Prudential Insurance Company of America (PICA), the second transaction between the two in recent months.
As longevity risk builds up within specialist providers of pension scheme buy-ins, buy-outs and longevity insurance or swaps, it needs to be passed on to sources of longevity reinsurance capacity.
Pension Insurance Corp. has been accumulating longevity risk through its insurance deals and has now twice elected to pass on some of this risk to Prudential. Prudential remains one of the largest providers of longevity reinsurance capacity in the market, assuming significant amounts which it treats to a degree as a hedge for the mortality risk exposures it assumes in its life insurance business.