CVS Health-owned health insurer Aetna strikes $200m Vitality Re X ILS deal
Health insurer Aetna, part of US drugstore operator CVS Health, has entered into a four-year reinsurance arrangement with Vitality Re X as part of its long-term capital management strategy.
Vitality Re X is a newly formed insurance company which issued health insurance-linked notes in a private offering in connection with this transaction.
The arrangement allows CVS Health to reduce its required capital and provides $200 million of collateralised excess of loss reinsurance coverage on a portion of Aetna's group commercial health insurance business.
"Today's transaction marks the successful completion of the tenth reinsurance arrangement under the Vitality Re program," said CVS Health chief financial officer Eva Boratto. "The Vitality Re program is an important component of our capital structure that lowers our cost of capital and drives capital efficiency."
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