Prudential and Scottish Widows reach first longevity reinsurance agreement
The Prudential Insurance Company of America (PICA) and U.K.-based insurer Scottish Widows Limited, a unit of Lloyds Banking Group, struck their first-ever longevity reinsurance agreement. PICA has assumed longevity risk for approximately $1.8 billion (£1.3 billion) of annuity liabilities held by Scottish Widows.
David Lang, Prudential’s lead negotiator for this transaction, said, "Prudential is privileged to be chosen by Scottish Widows as it seeks to efficiently manage its longevity risk over the coming decades. With our new partnership, Scottish Widows attains more flexibility for managing longevity risk, trusting that, with PICA, it has chosen a strong counterparty with shared values and a long-term commitment to the longevity risk transfer business."