12 August 2014 News

Prudential in $1.7bn deal with Rothesay Life

Prudential Retirement, a business unit of Prudential Financial, has completed its fourth longevity reinsurance transaction since 2011 with Rothesay Life and its affiliates.

Prudential will provide reinsurance of longevity risk to Rothesay Assurance for a block of 93 pension schemes. The transaction covers pension liabilities of $1.7 billion for 20,000 pensioners and deferred members in the U.K.

This is the second longevity reinsurance transaction that Prudential has closed in the past month, following its agreement to reinsure $27.7 billion of longevity risk associated with BT Pension Scheme liabilities.

"We are pleased to be able to collaborate with Rothesay in another transaction that helps to provide secure retirement benefits for thousands of pensioners," said Phil Waldeck, senior vice president of pensions and structured solutions for Prudential Retirement.

Amy Kessler, senior vice president and head of the longevity risk transfer team for Prudential Retirement, said: "This transaction demonstrates the continued strength of the pension risk transfer market and the capacity in the insurance and reinsurance sector to support the growing pension de-risking trend and to provide greater certainty for managing plan liabilities with longevity risk solutions.”

Tom Pearce, managing director of Rothesay Life, added: “Rothesay Life is delighted to build upon its partnership with Prudential with this new transaction. This latest deal is a further example of Rothesay Life’s low risk approach to managing its business.”

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