The transaction underscores the thriving market for U.K. pension de-risking and the continuing focus among U.K. group annuity writers to optimize capital and manage risk with longevity reinsurance solutions. Prudential is a recognized leader and innovator for such solutions.
“Prudential is very proud to build upon its growing partnership with Rothesay Life,” said Amy Kessler, head of Prudential Retirement’s Longevity Risk Transfer business. “Through six years and six transactions, our teams have worked consistently and collaboratively to meet Rothesay’s longevity reinsurance needs and to help secure the retirement benefits for thousands of U.K. pensioners.” The two companies struck their five previous longevity reinsurance agreements between 2011 and 2014.
Said Tom Pearce, managing director at Rothesay Life, “Rothesay is delighted to have completed this transaction with Prudential, building upon the longstanding relationship between the two firms. Entering into this agreement further underscores our proactive approach to risk management as we provide for the secure retirement of thousands of annuitants.”
David Lang, vice president of product development, who led the transaction for Prudential Retirement, added, “The growing U.K. market for pension de-risking has created a significant need for reinsurance solutions. As part of our long-term partnership, Rothesay consistently taps into Prudential’s longevity reinsurance capacity and expertise to support its market-leading pension risk transfer business in the U.K.”
Rothesay Life was established in 2007, and it has grown to become the U.K.’s fourth-largest annuity provider, with more than £20 billion in assets under management. Rothesay insures the pensions of more than 213,000 individuals in more than 160 U.K. pension funds.
Prudential Retirement is a global leader in the reinsurance market with more than $40 billion in international reinsurance transactions since 2011, including the largest longevity risk transfer transaction on record, a $27.7 billion agreement with the BT Pension Scheme.
About Rothesay Life:
Rothesay Life was established in 2007 and has become one of the leading providers of regulated insurance solutions in the U.K. market for pensions de-risking, making payments of around £1 billion a year from over £22 billion of insurance contracts. This strong growth has been achieved through the steady accumulation of pension scheme clients, significant strategic acquisitions and the reinsurance of in-force annuity portfolios.
Existing Rothesay Life clients include the pension schemes and members associated with such names as RSA, British Airways, Rank, Uniq, General Motors, the MNOPF (Merchant Navy Officers Pension Fund), InterContinental Hotels, Philips, GKN, Lehman Brothers, Zurich Assurance and the Civil Aviation Authority.
Rothesay Life is a secure long-term provider of pensions, focused on
- A flexible and committed approach to execution;
- Ongoing risk management to maintain balance sheet strength; and
- Robust operational processes.
About Prudential Retirement:
Prudential Retirement delivers retirement plan solutions for public, private and nonprofit organizations. Services include defined contribution, defined benefit and non-qualified deferred compensation recordkeeping, administrative services, investment management, comprehensive employee education and communications, and trustee services, as well as a variety of products and strategies, including institutional investment and income products, pension risk transfer solutions and structured settlement services. With more than 85 years of retirement experience, Prudential Retirement helps meet the needs of 4.2 million participants and annuitants. Prudential Retirement has $386.2 billion in retirement account values as of Dec. 31, 2016. Retirement products and services are provided by Prudential Retirement Insurance and Annuity Company, Hartford, Conn., or its affiliates.
Reinsurance contracts are issued by Prudential Retirement Insurance and Annuity Company, Hartford, Conn., 06103. PRIAC is not a U.K. authorized insurer and does not conduct business in the United Kingdom or provide direct insurance to any individual or entity therein. Prudential Financial, Inc. of the United States is not affiliated with Prudential plc, which is headquartered in the United Kingdom. For more information about Prudential Retirement's pension risk and longevity reinsurance businesses, visit pensionrisk.prudential.com
Prudential Financial, Inc. (NYSE: PRU), a financial services leader, has operations in the United States, Asia, Europe, and Latin America. For more information, please visit news.prudential.com.