Asset-intensive reinsurance is drawing increased attention from insurers looking to improve investment returns and deploy capital more efficiently, according to a report from PwC.
The practice involves transferring both asset and insurance risks to a reinsurer, most commonly for long-duration life and annuity products.
PwC attributed the growth over the past decade to several structural shifts, including the move from public to private ownership at many insurers, the rise of hybrid asset manager-reinsurer entities, and the expansion of private credit markets.
The scale of the shift is reflected in industry data. AM Best reported that the reinsurance leverage ratio for the US life and annuity industry reached 328% at the end of 2024, up from nearly 200% a decade earlier.
Separately, S&P research found that total reserves ceded by US life insurers to reinsurers grew to more than US$2.4 trillion by end-2024, with more than US$130 billion in liabilities offloaded that year alone, the Financial Times reported.
Between 2018 and 2023, US life and annuity companies ceded over US$600 billion in reinsurance, AM Best data showed, reducing their liabilities by a similar amount.
A wave of large transactions has illustrated the market's momentum. In 2025, Venerable closed a deal with Corebridge that increased its total assets under risk management by roughly 77% to US$118 billion on a pro forma basis.
MetLife separately agreed to reinsure approximately US$10 billion in US variable annuity and rider reserves with Talcott Resolution.
Resolution Life also announced a US$9.7 billion reserve transfer from Protective Life. President Moses Ojeisekhoba described the deal as evidence of continued acceleration "in the highly active, multi-trillion-dollar global life and annuity consolidation sector."
Block reinsurance transactions have moved well beyond basic annuity portfolios, PwC said, now encompassing universal life with secondary guarantees, long-term care, disability income, and variable annuities. That complexity has led asset-intensive reinsurance providers to partner with traditional reinsurers, retaining investment and liquidity risks while traditional players assume the insurance risks.
Flow reinsurance transactions, in which new policies are reinsured on an ongoing basis, are also increasing. PwC said these deals provide cedants with consistent capacity while offering reinsurers shorter execution cycles and lower costs.
The United States remains the primary market for asset-intensive reinsurance, but PwC pointed to increased transactions in Japan, along with upticks in South Korea, Hong Kong, and Singapore.
Competition is intensifying as new entrants emerge through asset manager-reinsurer partnerships. AM Best reported that the number of companies using sidecar vehicles tripled since 2021, with ceded reserves to those vehicles increasing threefold over two years.
Boston Consulting Group data from 2022 showed that private equity-backed reinsurers captured 43.3% of aggregate reserve credits on new transactions. The Bermuda Monetary Authority, meanwhile, estimated the global protection gap for guaranteed retirement income at US$51 trillion as of 2023.
PwC identified origination, transaction structuring, pricing, and capital access as key differentiators in an increasingly crowded market.
