FGH Parent L.P. and its subsidiaries under Fortitude Re have launched Fortitude Carlyle Asia Reinsurance Ltd. (FCA Re), a reinsurance sidecar backed by global investment firm Carlyle Group, the companies announced.
According to Fortitude Re, FCA Re has more than $700 million in deployable capital, including both equity and anticipated debt capacity. The vehicle has drawn equity commitments from Fortitude Re, Carlyle, and several global institutional investors, including T&D Insurance Group, AllianceBernstein, Shinhan Life, and the National Pension Service of Korea, among others.
“Fortitude Re has already reinsured approximately $15 billion in reserves on behalf of clients in Asia, and we are dedicated to making further investments in the region,” said Alon Neches, chief executive officer of Fortitude Re. “FCA Re will help us continue delivering solutions that drive our clients’ strategies forward.”
Brian Schreiber, partner at Carlyle and head of Carlyle Insurance Solutions, said FCA Re aligns with Carlyle’s broader strategic direction. “FCA Re is a natural extension of Carlyle’s strategy to deliver integrated asset, capital, and liability solutions to insurance clients worldwide,” he said.
The new Bermuda-domiciled reinsurer was established to strengthen Fortitude Re’s growth in the Asian life and annuity market. Initially, FCA Re will assume a share of existing liabilities from Fortitude Re and reinsure portions of the company’s future transactions in the region.
Under the structure, Fortitude Re will act as insurance sponsor, while Carlyle will serve as asset management sponsor to FCA Re. Once its capital is fully deployed, the sidecar is expected to contribute approximately $10 billion in fee-earning assets under management to Carlyle.
Fortitude Re said the move reflects the growing demand across Asia for capital-efficient reinsurance solutions. With aging demographics and the increasing need for insurers to manage long-term liabilities more effectively, the region remains “one of the most dynamic and attractive opportunities in global reinsurance,” BestWire reported.
Currently, Fortitude Re manages $101 billion in general and separate account insurance reserves and administers more than 4 million insurance policies.
Earlier this year, Unum Life Insurance Company of America, a subsidiary of Unum Group, completed a $3.4 billion long-term care reinsurance transaction with Fortitude Reinsurance Co. Ltd, according to BestWire. That deal transferred a portion of Unum’s long-term care and disability insurance portfolios to Fortitude Re.
Underwriting entities of FGH Parent L.P. maintain A (Excellent) financial strength ratings from AM Best.
What are your thoughts on the recent announcement? Share your insights in the comments below.
