RGA’s recent deal with Allianz Suisse points to the growing role of asset-intensive reinsurance (known also as funded re or full-risk co-insurance) as an efficient and resilient tool for capital and risk management for insurers of all sizes across Continental Europe.
RGA’s €300 million disability annuity reinsurance transaction with Allianz Suisse marks a significant milestone in European (re)insurance.
The deal, announced in August,1 points to the growing role of asset-intensive reinsurance as an efficient and resilient tool for capital- and risk-management for insurers of all sizes across Continental Europe. The transaction leveraged RGA’s holistic solution set in both deep biometric expertise and strong asset-management capabilities.
When considered alongside the 2024 €900 million transaction with Baloise, one of Belgium’s leading insurers, the Allianz transaction highlights RGA’s emergence as a solutions leader in the Continental Europe asset-intensive market. The Allianz transaction transferred market and biometric risks to RGA, allowing the reinsurer to guarantee the benefit payments to policyholders. This structure also served to stabilize Allianz’s solvency metrics and introduced new flexibility in capital deployment.
Successful execution of this transaction was built on a long-term collaborative process between RGA and Allianz, emphasizing transparency and trust to navigate the complexity of the deal. Although this type of transaction is more common in the UK and elsewhere around the globe, it is the first time this structure has been used in Switzerland.
This variant of coinsurance ensures policyholder funds remain protected, even in extreme scenarios. Policyholder security was one of the core objectives for Allianz and RGA throughout the process.
Just weeks after the deal was announced, the innovative features of the solution attracted significant interest from insurers and brokers. Many view this as a landmark precedent and a clear indication that insurers across Continental Europe might consider incorporating asset-intensive reinsurance into their capital- and risk-management strategies.
Although the Swiss transaction focused on in-force business, asset-intensive reinsurance also holds significant strategic potential for new business across the region’s extensive retail savings market. By unlocking capital tied up in legacy product structures and applying it to new business offerings, insurers can redirect and optimize capital resources to drive product innovation, particularly through enhanced guarantees and features for savings, annuities, and hybrid pension offerings.
For insurers, pursuing a “capital-light” strategy is an attractive option at a time when many consumers attach increased value to guarantees. This is especially true in markets such as Italy and the UK, where regulatory shifts and interest rate volatility have strained traditional capital-heavy models.
By partnering early in product development, RGA aims to enhance design and embed reinsurance solutions that optimize both sides of the balance sheet. This long-term strategy could redefine how insurers approach guaranteed products, especially those with biometric components. While banks may offer financial guarantees, they lack the biometric underwriting expertise that RGA brings to hybrid product design.
RGA’s ability to manage both biometric and asset risks uniquely positions the global reinsurer to support insurers in designing capital-light products that also meet policyholder guarantees and expectations.
The landmark structure of the Allianz transaction demonstrates RGA’s commitment to pioneering innovative reinsurance solutions. As a global leader in capital-motivated reinsurance and longevity risk-management, RGA aims to continue delivering sophisticated asset-intensive solutions that strengthen its clients’ financial positions across Continental Europe.
Contact us today to learn more about partnering with RGA in Continental Europe.
