Cowdery’s Resolution establishes capital in US

Resolution Life, the specialist insurer that buys and consolidates life operations in run-off, has given its clearest indication yet of its ambitious intentions to target the US life insurance sector.

The US business has established a permanent capital structure that, the company said, aligns its long-term commitment to the US market with the investment horizon of its institutional investors and the duration of underlying life insurance policies.

The company, part of the chairman Clive Cowdery’s London-based Resolution Group, which has a long track record of similar deals in the UK, recently completely its first US deal buying Lincoln Benefit Life from Allstate for $600 million.

Resolution Life now plans to initially invest $2 billion and build a “lasting, sizeable and differentiated” life insurance business through the acquisition and management of in-force portfolios, the company said.

“At Resolution Life, we provide a unique opportunity to insurance companies by acquiring their non-core US life insurance and annuity portfolios and making them our sole priority,” said chief executive Weldon Wilson. “We have a long-term view of the US market and have a deep commitment to delivering high-quality customer service and building enduring relationships with our policyholders.”

Over the past decade, the Resolution group consolidated a substantial share of the UK life market through the acquisition of 25 life insurers, comprising over 10 million policyholders and $200 billion of policy assets.

“The US life insurance industry is highly mature, with over-capacity and increasing competition aimed at a shrinking new business pool. This has created significant profitability pressure and many companies’ life insurance portfolios are becoming increasingly non-core businesses. We believe there is significant opportunity for industry consolidation,” said chairman Cowdery.