MetLife has concluded a $10bn variable annuity risk transfer transaction with Talcott Resolution Life Insurance Company, an annuities and life insurance subsidiary of Talcott Financial Group.
This transaction, initially announced in April this year, sees Talcott reinsure approximately $10bn in variable annuity and rider reserves.
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The deal aims to lower MetLife’s portfolio risk while leaving policy administration and servicing with MetLife.
The reinsurance structure is based on modified coinsurance and funds withheld arrangements.
MetLife anticipates giving up annual adjusted earnings of around $100m due to this transaction, offset to some extent by expected annual hedge cost savings of roughly $45m.
This step supports MetLife’s aim to reduce exposure in its legacy business.
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By GlobalDataIt also reflects the company’s process of executing risk transfer strategies within MetLife Holdings, which contains closed-block operations from the previous US Retail segment.
MetLife will remain responsible for the administration and servicing of the policies.
MetLife Investment Management will oversee around $6bn in assets under investment management agreements with Talcott.
This transaction brings the total amount of reserves reinsured by Talcott in 2025 to $14bn.
Earlier this year, Chariot Reinsurance (Chariot Re) was established as a Bermuda-based Class E life and annuity reinsurance practice in partnership with MetLife and General Atlantic.
Chariot Re assumed reinsurance responsibilities for liabilities totalling approximately $10bn from a MetLife subsidiary as its initial transaction.
The block taken on by Chariot Re includes structured settlement annuity contracts and group annuity contracts linked to pension risk transfers that were originally issued by MetLife.
In September this year, MetLife named Adrienne O’Neill as its new executive vice-president and chief accounting officer.
O’Neill is tasked with managing the company’s accounting functions, which include corporate accounting, financial reporting, and financial planning and analysis.
