Financial Solutions
RGA’s Global Financial Solutions (GFS) team serves as a trusted partner, respected leader, and first-to-mind solutions provider for clients’ largest and most complex risk and capital needs. In 2023, strong performance across all regions and product lines, including asset-intensive, longevity, and capital solutions, produced a record-high $1 billion in pre-tax adjusted operating income.*
Economic, regulatory, and demographic changes drove exceptional global demand for RGA’s innovative financial solutions in 2023. The GFS team’s comprehensive solution set, long-term partnership approach, and biometric risk management expertise helped RGA successfully deliver on key strategic priorities:
- Growing the asset-intensive business globally
- Expanding into new longevity and pension risk transfer markets
- Further developing targeted capital solutions
With a creative and innovative mindset and a reputation for execution certainty, as well as established credibility with regulators, RGA is an industry leader in structuring transactions for clients that optimize capital and mitigate long-term risk.
In 2023, GFS developed customized financial solutions across all product lines: asset-intensive, longevity, and capital solutions. RGA’s asset-intensive business enables clients to manage asset-related risk efficiently, to optimize available capital, and to improve the performance of savings and retirement products. Longevity transactions help reduce exposure to longevity risk with longevity swap reinsurance treaties or pension risk transfer solutions. The capital-solutions business provides remote-risk protection, allowing clients to better manage regulatory capital and meet solvency requirements.
Regional highlights from 2023 include:
2023 was a pivotal year for GFS North America, marked by significant achievements across various lines of business. Generating pre-tax adjusted operating income of $451 million,* the U.S. and Latin America team maintained its market-leading position in creating innovative and highly tailored solutions to support longevity, asset-intensive, and capital-solutions transactions.
With more than 15 years of longevity experience globally, GFS entered the U.S. pension risk transfer (PRT) market by executing three transactions in 2023. This achievement marks a vital step in RGA’s long-term strategy and positions the company for continued growth as plan sponsors seek attractive de-risking solutions for their pension plans. Backed by a strong foundation built on long-term commitments and trust from clients, RGA is set to meet the growing needs of the PRT market, providing financial strength, unique investment capabilities, and execution certainty.
In 2023, GFS saw progress in capital-solutions business as clients sought structured reinsurance solutions to help meet regulatory requirements, free up capital from redundant reserves, and grow their businesses in the region. Working closely with RGA’s Investments team, the asset-intensive line also produced a strong year in 2023. Customized transactions enabled clients to reduce capital strain from, and improve returns on, savings- and retirement-oriented products, including payout annuities, interest-sensitive life insurance, and fixed and variable annuities.
Since entering the U.S. stable value market in 2012, RGA has provided wrap coverage for 401(k) and other defined contribution plans. As of December 31, 2023, the notional amount of RGA’s stable value wrap portfolio totaled $16.1 billion, and RGA remains committed to the market and the growth potential in this space.
In Canada, GFS generated $52 million in pre-tax adjusted operating income*, continuing to draw upon the division’s collective expertise and local market knowledge to implement innovative financial solutions. During a successful year for capital-solutions transactions, RGA provided efficient capital relief to improve profitability. This year also marked the execution of RGA’s first-ever lapse shock absorber transaction in North America, and the expansion of the unit’s offerings in the Canadian marketplace.
The groundwork laid in the U.S. PRT market in 2023 provides confidence in what the future holds. RGA is poised to stand out as a distinct and highly successful leader in this space.
GFS Asia Pacific built on its upward trajectory with exceptional results in 2023, generating $212 million in pre-tax adjusted operating income,* a 32% increase compared to 2022. These positive results underscore RGA’s commitment to maintaining momentum gained in recent years. Ongoing regulatory shifts and an active interest rate environment produced increased client demand for sophisticated financial solutions.
Building on its leading position in the Asia market, RGA expanded its client base with the execution of the first large asset-intensive transaction with a Japanese mutual insurer in 2023. Pioneering work to develop new products and reinsurance solutions continued across the region, including in Hong Kong, where RGA partnered with a major insurer to develop innovative products for high net worth consumers, coinsuring the offerings to optimize the product offering and manage the client’s financial metrics effectively. These transactions highlight the strong year for this business line in Asia, reinforcing RGA’s position as a trusted partner in providing effective and innovative solutions for capital management of in-force blocks of business.
Looking beyond 2023, RGA’s strengthening of its robust local presence, technical expertise, and long-term client partnerships in the region sets the stage for future expansion. GFS Asia Pacific is poised to build on its position as a regional leader in the development of innovative solutions that help clients navigate complex regulatory environments with agility and precision.
We anticipate reinsurance will achieve greater market penetration and become even more integral to our clients’ local insurance operations in the Asia Pacific region, and we are ready to continue creating new paths to growth for our clients and partners.
GFS in EMEA produced a standout year in 2023, recording $355 million in pre-tax adjusted operating income, a 45% increase compared to 2022, and ending the year with a robust new business pipeline. RGA’s legacy of tailored longevity and asset-intensive transactions distinguish the GFS team as pioneers of financial solutions in the region.
In the U.K. alone, RGA has taken on more than $15 billion of longevity risk, underscoring GFS’s robust market presence and scale. As pension schemes look to offload risk to insurers, the U.K. has seen record PRT transaction volumes. RGA leveraged years of local experience to provide reinsurance support for some of the largest transactions in this market in 2023.
Across the region, RGA solidified its position as a financial solutions leader and brought counterparty strength, seasoned expertise, and execution certainty. In 2023, the GFS team helped EMEA clients manage lapse risk in the rising interest rate environment, notably in South Africa, and expanded capital-solutions offerings to France and Italy. A €900 million transaction with the subsidiary of one of the leading insurers in Belgium, announced in February 2024, marked a new milestone in RGA’s expansion in the Continental Europe asset-intensive reinsurance market and underscored GFS’s deep expertise and strong position in EMEA.
We're well positioned for growth in the region and remain dedicated to creating innovative financial solutions that cater to the dynamic needs of our clients.
