MetLife reinsures $320m of pension longevity risk for Rothesay Life

Metlife, Inc., one of the largest life and annuities insurance groups in the world, completed a second longevity reinsurance transaction in the UK market, reinsuring $320 million of pension liability related longevity risk for Rothesay Life.

Metlife entered into the longevity reinsurance arrangement with Rothesay Life using its susbidiary Metropolitan Tower Life Insurance Company.

Rothesay Life is a regular underwriter of pension related exposures, entering into numerous pension risk transfer transactions over the years.

As a such it is a heavy user of longevity reinsurance and has also entered into other longevity risk transfer arrangements in the past.

“Reinsurance solutions play an important role in direct insurers’ ability to secure the retirement benefits of U.K. pensioners,” explained Graham Cox, executive vice president and head of Retirement & Income Solutions at MetLife. “This transaction gives MetLife the opportunity to use our mortality expertise and supports Rothesay in its pension de-risking activity.”

The transaction saw MetLife’s Metropolitan Tower Life Insurance Company providing reinsurance to Rothesay Life for the longevity risk associated with around $320 million of pension liabilities.

“We look forward to building our relationship with Rothesay, a leading direct insurer in the U.K. pension de-risking market,” Cox added. “This transaction grows our book of business in the U.K. longevity reinsurance market and continues to build on our long history of risk management expertise in this space.”

“We are delighted to have executed a longevity reinsurance agreement with Metropolitan Tower Life for the first time,” Tom Pearce, Managing Director, Rothesay said. “A deep and diverse pool of reinsurance capital helps the UK de-risking market to grow and supports the long-term security we provide for pensions.”

Met Life entered into its first UK longevity reinsurance transaction earlier this year with pension consolidator Pension Insurance Corporation plc (PIC).

Read about many historical longevity swap and reinsurance transactions in our Longevity Risk Transfer Deal Directory.