Protective Life Corporation, part of Dai-ichi Life Holdings, has entered a reinsurance agreement with Resolution Life to cede approximately $9.7bn in reserves.
The agreement will see Protective’s operating subsidiaries, Protective Life Insurance Company and West Coast Life Insurance Company, ceding specific blocks of structured settlement annuities as well as secondary guaranteed universal life policies to Resolution Life.
Protective will retain the administration of the policies.
The move is set to mitigate market risk and free up capital for Protective, enabling the company to invest in growth opportunities.
Protective plans to expand through acquisitions and strengthen its core retail businesses, which include protection, retirement, asset protection and employee benefits, while continuing to offer its “no-lapse” guaranteed universal life policy.
For Resolution Life, this deal expands its management of in-force life insurance policies, bringing its general account life and annuity reserves to $100bn and increasing its policies in-force to more than four million.
The deal is set to be finalised in 2025, contingent on standard closing conditions and regulatory clearances.
Wells Fargo and Willkie Farr & Gallagher provided financial and legal advisory services, respectively, to Protective in this transaction.
Resolution Life’s financial and legal advisory needs were met by JP Morgan and Debevoise & Plimpton, respectively.
Protective CEO and president Rich Bielen said: “This transaction represents an important milestone, allowing us to generate capital that can be invested for continued growth. We remain committed to growing life insurance sales through our valued distribution partners and look forward to continuing to provide exceptional service to our customers.
Resolution Life US CEO Warren Balakrishnan stated: “This strategic transaction with Protective showcases our ability to manage complex life and annuity products at scale. Our substantial capital strength and proven execution record provide a strong, long-term partner for Protective Life and its policyholders. This transaction is a great example of our reinsurance offering to the US life and annuity market.”
In November 2024, Protective Life acquired ShelterPoint Group, its seventh acquisition since becoming a part of Dai-ichi in 2015.
In December, Japan’s Nippon Life Insurance announced its intention to purchase the remaining shares of Resolution Life Group for an estimated $8.2bn (Y1.25trn).
