Aflac Re Bermuda completes first external transaction with Japan Post Insurance

Aflac Re Bermuda has completed its first external reinsurance transaction, partnering with Japan Post Insurance to reinsure a block of whole life annuities through coinsurance.

Max Brodén (pictured), senior EVP, CFO of Aflac Incorporated, parent company of Aflac Re, said: “This transaction marks a significant milestone in the history of Aflac Incorporated and Aflac Re. While Aflac Re has secured multiple reinsurance transactions from Aflac Life Insurance Japan, this is the first transaction with an external party. In addition, this transaction further contributes to our strategic partnership with Japan Post Insurance as we aim to create shared value for both our policyholders and shareholders.”

Tsana Nobles, president of Aflac Re Bermuda, added: “We look forward to continuing to build our relationship with Japan Post Insurance. We also look forward to leveraging our expertise to provide similar support for other Japanese life insurers to reduce risk, enhance their capital management and expand their new business opportunities.”

Japan Post Insurance will continue to service and administer the policies. 

The deal, effective March 2026, is a strategic response to significant structural shifts in the Japanese life insurance market. This transaction is likely driven by two primary market dynamics: the transition to a new regulatory capital regime and a growing industry-wide trend of legacy block risk transfers.

As of the end of March 2026, Japan officially implemented its new Economic Solvency Ratio (ESR) framework, replacing the older, less sensitive solvency margin ratio. Under this new regime, insurance liabilities are valued at market interest rates, which significantly increases the capital charge for legacy products that carry long-term guarantees. By transferring this block to Aflac Re Bermuda, Japan Post Insurance is optimising its balance sheet in a jurisdiction respected for its strong regulatory health.

This deal reflects a broader trend among Japanese insurers to use Bermuda-domiciled reinsurers for capital management. Bermuda’s regulatory environment is recognised for its sophistication in handling long-dated life and annuity risks. Japan Post Insurance’s decision to engage in coinsurance mirrors similar recent moves by competitors like Nippon Life and Dai-ichi Life.

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