Dec 17 Munich Re has won a 400
million pound ($645 million) deal from British pensions insurer
Pension Insurance Corporation (PIC) to help it cover risks
associated with people living longer than expected.
PIC is paying Munich Re, the world's biggest reinsurer, to
take on liabilities from pension fund business PIC has insured
that is affected by so-called increased life duration.
Pension funds are struggling to cope with extra costs from
people living longer in retirement and are also finding it tough
to generate adequate returns due to market volatility since the
As a result, insurers and reinsurers are capitalising on
increased demand from pension funds for ways to manage their
PIC, which insures pension fund liabilities, has done a
total of 1 billion pounds this year of so-called longevity
insurance deals including the Munich Re contract. It has done 4
billion pounds worth over the past four years.
Swiss Re last week won a similar deal worth 800
million pounds with the pension fund of British insurer LV to
help it absorb the cost of members living longer than expected