Prudential, PIC Reach $1.2 Billion Longevity Reinsurance Agreement
Prudential Retirement, a unit of Prudential Financial, Inc. (NYSE:PRU), and Pension Insurance Corporation (PIC), have entered into their fifth longevity reinsurance transaction since 2015. In the agreement, The Prudential Insurance Company of America assumes the longevity risk for $1.2 billion (about £900 million) in pension liabilities, covering approximately 4,000 pensioners across four pension schemes.
The transaction highlights the rebounding demand for pension de-risking solutions in the U.K., and the desire of many U.K. pension insurers to manage their risks and capital using longevity reinsurance. Prudential is a leader and innovator of such solutions.
“Prudential is proud to strengthen its growing partnership with Pension Insurance Corporation,” said William McCloskey, Prudential’s head of transactions for international longevity reinsurance. “Our teams have worked closely and collaboratively on five transactions worth nearly $5 billion. These agreements help PIC to manage longevity risk and thereby secure the retirement benefits of thousands of U.K. pensioners.” The two companies concluded their first agreement in 2015.
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