By Doug Alexander
(Bloomberg) --Nice-West Lifeco Inc. agreed to promote its U.S. particular person life insurance coverage and annuity enterprise to Dai-ichi Life Insurance coverage Co.’s Protecting Life Corp. in a deal valued at $1.2 billion.
The transaction worth features a capital launch of about $400 million, the Winnipeg, Manitoba-based insurer stated Thursday in an announcement. Nice-West expects a book-value lack of $70 million, and $57 million of transaction prices. The enterprise transferred contains bank-owned and corporate-owned life insurance coverage, single premium life insurance coverage, particular person annuities and closed block life insurance coverage and annuities.
“This transaction permits us to give attention to the retirement and asset-management markets within the U.S.,” Nice-West Lifeco Chief Government Officer Paul Mahon stated within the assertion. “With the strengthened capital place ensuing from this transaction, we may even think about different capital-management actions, together with potential share repurchases, to mitigate the earnings influence from the sale.”
The insurer stated that its Colorado-based Nice-West Life & Annuity Insurance coverage Co. will maintain a small block of collaborating life insurance coverage insurance policies that will probably be administered by Protecting Life after the deal’s completion, anticipated by mid-year.
Bloomberg Information reported in November that Nice-West was trying to promote its Particular person Markets enterprise within the U.S. Insurers have been steadily promoting blocks of annuities or placing reinsurance offers to unload such insurance policies, which people purchase to ensure a gradual stream of revenue after retiring. Insurers wish to offload insurance policies with beneficiant funds written earlier than the monetary disaster.
Nice-West’s Canadian rival Manulife Monetary Corp. introduced reinsurance transactions in November tied to a few of its U.S. annuities to release C$1 billion ($750 million) of capital from the legacy companies. Personal fairness companies and insurers resembling Athene Holding Ltd. and Decision Re, which specialise in managing complicated, long-term liabilities, have been prepared consumers.
Protecting Life, acquired by Japan’s Dai-ichi Life in 2015, has a historical past of placing offers for companies and blocks of insurance policies. The corporate purchased a term-life enterprise from Genworth Monetary Inc. in 2016 and struck a cope with Axa SA in 2013.
--With help from Katherine Chiglinsky.To contact the reporter on this story: Doug Alexander in Toronto at [email protected] To contact the editors accountable for this story: Michael J. Moore at [email protected] ;David Scanlan at [email protected] Daniel Taub, Steve Dickson
