Forms new Bermuda multi-line reinsurer Acquires U.S. life insurer
Obtains Reciprocal Jurisdiction Reinsurer status
Fortitude Re announced today the formation of a Bermuda multi-line reinsurer and the acquisition of a U.S. life insurer. In addition, Fortitude Re’s subsidiary, Fortitude Reinsurance Company Ltd. (“FRL”), Bermuda’s largest multi-line reinsurer, obtained approval to operate as a Reciprocal Jurisdiction Reinsurer, the first such approval to be granted by the Texas Department of Insurance (“TDI”). As a result, Fortitude Re can now offer the flexibility to transact through multiple entities and structures to help its clients achieve their objectives.
Today’s announcement follows other recently announced transactions that introduce additional capabilities to Fortitude Re’s franchise, including the acquisition of two U.S.-domiciled third party administrators from American International Group, Inc. (Press Release) and the pending acquisition of Prudential Annuities Life Assurance Corporation and its in-force legacy variable annuity block from Prudential Financial, Inc. (Press Release).
New Bermuda Reinsurer and U.S. Reinsurance Platform
Effective January 1, 2022, Fortitude International Reinsurance Ltd. (“FIRL”) commenced operations as a Class 4 and Class E reinsurer, licensed by the Bermuda Monetary Authority. FIRL will complement Fortitude Re’s other operating entities and focus on reinsurance solutions for insurers domiciled outside the U.S.
In addition, on January 3, 2022, Fortitude Re completed its acquisition of Rx Life Insurance Company (to be renamed Fortitude U.S. Reinsurance Company) (“Fortitude Re U.S.”) from Heritage Life Insurance Company. Fortitude Re U.S., which will serve as a U.S. reinsurance platform for Fortitude Re, is an Arizona domiciled life and annuity insurer widely licensed in the U.S. This acquisition will enable Fortitude Re to offer clients a U.S. domiciled reinsurance option.
Reciprocal Jurisdiction Reinsurer Status
Effective January 1, 2022, the TDI granted FRL authority to operate as a Reciprocal Jurisdiction Reinsurer. FRL expects to seek similar status in other selected U.S. jurisdictions in the near future.
FRL’s Reciprocal Jurisdiction Reinsurer status allows U.S. ceding companies to take full statutory credit for reinsurance ceded to FRL without any regulatory prescribed collateral requirements, effectively treating FRL for these purposes as a U.S. domiciled reinsurer. FRL is among the first reinsurers to obtain such status in the U.S.
“The transactions and regulatory approval represent an important step in the evolution and expansion of the capabilities Fortitude Re is able to offer to clients to solve their most complex challenges. With the establishment of FIRL, we expect to grow our international reinsurance business in Asia and the U.K. and European markets,” said James Bracken, Fortitude Re CEO.
Sidley Austin LLP served as legal advisor and Merger & Acquisition Services, Inc. served as a financial advisor to Fortitude Re in connection with the acquisition of Fortitude Re U.S. Mitchell, Williams, Selig, Gates & Woodyard, P.L.L.C. served as legal advisor to Fortitude Re in connection with FRL’s application for Reciprocal Jurisdiction Reinsurer status.
About Fortitude Re
The Fortitude Re group includes Bermuda’s largest multi-line composite reinsurer with unique competitive advantages and expertise to design bespoke transactional solutions for legacy Life & Annuity and P&C lines. Fortitude Re is an independent company backed by a consortium of sophisticated investor groups led by The Carlyle Group and T&D Insurance Group. Fortitude Re holds approximately $45 billion in invested assets as of June 30, 2021. For more information, visit www.fortitude-re.com. Follow Fortitude Re on LinkedIn.
Lara Watson, firstname.lastname@example.org