Fortitude Re in line for Taiyo Life reinsurance

Japan’s Taiyo Life Insurance Company is in discussion with Fortitude Re over possible reinsurance to cede its in-force individual annuity business.

According to an announcement by Taiyo’s parent T&D Holdings, the Bermuda reinsurer is among those being considered for the transaction of approximately 580 billion yen in policy reserve and an estimated 710bn yen of reinsurance premiums.

“Taiyo aims to reduce its investment risk and to enhance its future profitability and capital efficiency through offloading in-force individual annuity business, which guarantees high interest rate, via reinsurance,” the company said in a statement.

“The reinsurance transaction which Taiyo is contemplating is to transfer the economic risk of the in-force business and does not cause any changes upon the insurance contracts between the policyholders and Taiyo.”

While Fortitude Re is the only reinsurer named, T&D states that it “has not made any commitments in terms of the reinsurance arrangement described hereon yet”.

It plans to close the deal by the end of March 2022.