Reinsurance Group of America to acquire Hodge Life Assurance
Reinsurance Group of America, a life and health reinsurer, has agreed to acquire Hodge Life Assurance (HLAC), the PRA authorized life insurance company of Welsh banking group Hodge.
The financial terms of the deal were not disclosed.
Hodge Life Assurance has annuity liabilities of around £570 million ($780 million).
Larry Carson – Executive Vice President, Global Financial Solutions, Reinsurance Group of America said: “The purchase of HLAC demonstrates RGA’s continued strong support of the U.K. market and our commitment to working with our clients around the world to provide capital and risk-management solutions.
“We are delighted to be bringing this business into the RGA family and we believe that RGA provides a strong and stable home for HLAC’s policyholders.”
Hodge Life Assurance will pull out its products from the market owing to the deal and will stop selling annuities and equity release mortgages.
The sale of Hodge Life Assurance has been taken up by Hodge to focus on scaling its specialist lending business and sustain its recent growth in the markets.
Hodge said that it will continue selling all other existing products, which include retirement interest only (RIO) and holiday let mortgages. Besides, the Welsh banking group said that it will stay committed to the later life and specialist lending market.
David Landen – Hodge Group CEO said: “This is a significant transaction for Hodge; allowing us to focus and grow across our specialist markets through Hodge Bank. Later life lending remains a key part of our business and we will continue to evolve and develop our product range.
“As a result of the sale, we are withdrawing from the equity release market. However, as the longest established equity release lender in the UK, we are looking at opportunities to re-enter this market soon, working with third party funders.”
The closing of the deal is subject to regulatory approval.