Life-annuity sidecars gain traction as reinsurance solution
February 25, 2025 by Kenneth Araullo
The growth of US annuity sales has driven insurers to increase their use of sidecars as a tool to manage risk-based capital levels and accommodate expanding reserves.
According to a new report from AM Best, ceded reserves tripled between 2021 and 2023, reaching nearly US$55 billion.
The report highlights how the individual annuity sector has seen a 66% rise in reinsurance leverage over the past five years. The demand for first-year premium surplus relief has also reached its highest point in a decade as insurers seek to balance new premium growth.
Originally Posted at Insurance Business on February 25, 2025 by Kenneth Araullo.
Categories: Industry Articles
