Longevity risk transfer will play an even more important role in the years to come.
Our longevity solutions
Hannover Re has been the market-leading reinsurer in the UK longevity market for many years. Having entered the market in 1995 with the launch of enhanced annuities, we have written over GBP 5 billion single premium of enhanced annuitants. Using our expertise built up in reinsuring enhanced annuitants, we entered the emerging area of pension buyouts for UK Defined Benefit pension funds and regular premium annuity treaties in the early days.
Our longevity solutions are highly tailored and customised to our clients’ needs, drawing on global experience and capacity.
With the rapid expansion of the pension buy-out market we have concluded transactions (in terms of net present value of premium) in the order of GBP 18 billion in the UK pension fund buyout market. We believe that there is significant potential for reducing the longevity risks faced by Defined Benefit retirement schemes in non-UK markets.
With our expertise build in the UK we now focus on worldwide developments. Enhanced annuities are also sold in South Africa and we are evaluating the opportunities for enhanced annuities in Australia where currently regulatory changes offer great chances for enhanced annuities.
Solutions for other markets are flexible annuity concepts, such as a combination of draw-down and a deferred guaranteed lifelong annuity. Here the client can flexibly withdraw their money say from age 65 to 85 and from age 85 a lifelong annuity will be paid.
Another concept offers flexibility with regard to the investment options. The reassurance is based on so-called units where the fund value is converted to an amount of units. The guaranteed income is based on units and the actual annuity payments depend on the unit value.
Concepts range from solutions for long-term care, equity release to index solutions. These concepts are not exhaustive and we look into each and every market and the specific customer need to develop tailor made solutions.
We are well placed to discuss options and present ideas.
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