2018 US-Canada Life Reinsurance Survey Results · Many factors will influence future life reinsurance volumes • Direct life sales, the economy and regulation, in addition to the

2018 Life Reinsurance Survey Results

Anthony Ferraro, FSA, MAAA

VP & Actuary, Life Pricing

Disclaimer

Munich Re prepared this survey on behalf of the Society of Actuaries Reinsurance

Section as a service to section members. The contributing companies provide the

data in response to the survey. The data is not audited and Munich Re, the Society

of Actuaries and the Reinsurance Section take no responsibility for the accuracy of

the figures.

2018 Life Reinsurance Survey 2© 2019 Munich American Reassurance Company. All Rights Reserved.

2018 Life Reinsurance Survey results

Who: Top U.S. and Canadian reinsurers

What: Individual and group new business (assumed) and in force

Definitions

Recurring: issued in same year as reinsured

Portfolio: issued prior to year reinsured and financial reinsurance

Retrocession: reinsurance not directly written by ceding company

Reinsurance figures for individual life based on amount (NAR) and group life based

on premium

Note: some figures may not add due to rounding

3© 2019 Munich American Reassurance Company. All Rights Reserved. 2018 Life Reinsurance Survey

Reinsurance landscape

4© 2019 Munich American Reassurance Company. All Rights Reserved.

$498

$169

$7

$506

$101

$7

$0

$100

$200

$300

$400

$500

$600

Recurring Portfolio Retrocession

U.S. IL New Business Volumes ($ Billions)

$168

$0$9

$171

$19

$7

$0

$20

$40

$60

$80

$100

$120

$140

$160

$180

Recurring Portfolio Retrocession

Canada IL New Business Volumes ($CA Billions)

$777

$3,462

$821

$4,490

$0

$500

$1,000

$1,500

$2,000

$2,500

$3,000

$3,500

$4,000

$4,500

$5,000

Recurring Portfolio

U.S. Group In Force Premium ($ Millions)

$104

$835

$93$32

$0

$100

$200

$300

$400

$500

$600

$700

$800

$900

Recurring Portfolio

Canada Group In Force Premium ($CA Millions)

2017 2018

+2% -41%

+2% -19%

+6% +30%

-11% -96%

-1%

2018 Life Reinsurance Survey

U.S. individual life new business

A brief history…

U.S. individual life recurring new business


# of

Reinsurers30 25 15 9

Recurring NB $156B $268B $844B $506B

Top

Reinsurers

▪ Transamerica

Occidental ($28B)

▪ Lincoln National

Life ($17B)

▪ General Re ($16B)

▪ Transamerica Re

($41B)

▪ Lincoln National

Life ($34B)

▪ RGA Re ($24B)

▪ RGA Re ($183B)

▪ Scottish Re

($131B)

▪ Transamerica Re

($130B)

▪ SCOR ($115B)

▪ RGA Re ($94B)

▪ Swiss Re ($94B)

▪ Munich Re ($93B)

2018200519951986

Annual Percentage Change in U.S. Recurring new Business


U.S. individual life new business trend

-9.4%

-15.3%

-8.7%

-3.4%

-0.5%

-4.7%-3.5%

12.3%

8.9%

1.7%

-20.0%

-10.0%

0.0%

10.0%

20.0%

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

U.S. Individual Life Insurance Sales (Face Amount)

2018 Life Reinsurance

Survey


U.S. recurring cession rate

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Amt Reinsured $596 $505 $461 $445 $443 $422 $407 $457 $498 $506

Amt Retained $1,149 $1,168 $1,211 $1,234 $1,197 $1,168 $1,240 $1,233 $1,225 $1,231

% Reinsured 34% 30% 28% 27% 27% 27% 25% 27% 29% 29%

34%

30% 28% 27% 27% 27%25%

27%29% 29%

0%

5%

10%

15%

20%

25%

30%

35%

40%

$-

$200

$400

$600

$800

$1,000

$1,200

$1,400

$1,600

$1,800

$2,000

$ B

illio

ns

U.S. recurring by company – top five companies

(representing 89% of total market share)


66

92

96

89

105

56

93

94

94

115

- 20 40 60 80 100 120 140

Hannover Life Re

Munich Re

Swiss Re

RGA

SCOR Global Life

2018 2017

Recurring Business ($ billions) 2018 Market Share

SCOR Global Life (US), 23%

RGA, 19%

Swiss Re, 19%

Munich Re (US), 18%

Hannover Life Re, 11%

U.S. recurring by company – next four companies


Survey


9

10

12

19

9

13

14

19

0 5 10 15 20

Optimum Re

General Re Life

PartnerRe (Aurigen)

Canada Life

2018 2017

Recurring Business ($ billions) 2018 Market Share

Top 5, 89%

Canada Life, 4%

PartnerRe, 3%

Optimum Re, 2% General Re, 2%

U.S. recurring by company ($ billions)

All companies


Company

2017 2018Change

from

2017 to

2018

Assumed

BusinessMarket Share

Assumed

BusinessMarket Share

SCOR Global Life $105 21% $115 23% 9%

RGA $89 18% $94 19% 6%

Swiss Re $96 19% $94 19% -2%

Munich Re $92 19% $93 18% 1%

Hannover Life Re $66 13% $56 11% -14%

Canada Life Re $20 4% $20 4% 0%

PartnerRe (Aurigen) $12 2% $14 3% 17%

General Re Life $10 2% $13 2% 20%

Optimum Re $9 2% $9 2% -6%

Total $498 100% 506 100% 2%

Top five companies now represent 89% of market share

$777

$94

$1,042

$344

$628

$238

$130

$729

$169

$101

-

200

400

600

800

1,000

1,200

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

U.S

. $

(b

illio

ns)

U.S. portfolio business


U.S. portfolio business ($ billions)

U.S. retrocession ($ billions)


$15$7 $8 $7 $9

$203

$5 $8 $7 $7

-

50

100

150

200

250

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Canada individual life new business

A brief history …

Canada individual life recurring new business ($CA)


# of

Reinsurers14 14 7 7

Recurring

NB$9B $17B $110B $171B

Top

Reinsurers

▪ Munich Re

($3B)

▪ Canadian Re

($2B)

▪ St. Lawrence

Re

($1B)

▪ Swiss Re ($4B)

▪ Munich Re ($4B)

▪ RGA Re ($3B)

▪ Munich Re ($49B)

▪ RGA Re ($31B)

▪ Swiss Re ($26B)

▪ Munich Re

($46B)

▪ RGA Re

($42B)

▪ SCOR ($27B)

2018200519951986

Canada Recurring Individual Life Volume ($CA Billions)


Canada recurring cession rate

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018

Amt Reinsured $152 $153 $153 $149 $143 $142 $153 $160 $168 $171

Amt Retained $52 $66 $67 $84 $90 $87 $98 $116 $92 $83

% Reinsured 75% 70% 70% 64% 61% 62% 61% 58% 65% 67%

75%

70% 70% 64%61% 62% 61%

58%

65%67%

$0

$50

$100

$150

$200

$250

$300

$C

A B

illi

on

s

Canada recurring by company (all companies)


Survey


2

10

28

19

23

44

42

6

12

16

24

27

42

46

0 10 20 30 40 50

Hannover Life Re

Optimum Re

Swiss Re

PartnerRe

SCOR Global Life

RGA Re

Munich Re

2018

Recurring Business ($CA billions) 2018 Market Share

Munich Re (Canada),

27%

RGA Re (Canada),

24%

SCOR Global Life (Canada),

16%

PartnerRe, 14%

Swiss Re, 9%

Optimum Re, 7%

Hannover Life Re, 3%

Canada portfolio and retrocession

18

Retrocession ($CA Billions)

2018 Life Reinsurance Survey © 2019 Munich American Reassurance Company. All Rights Reserved.

Pacific Life, $4.0

AXA Equitable, $0.04

Berkshire Hathaway, $2.9

Group business

Group business – recurring business

20

$546

$646

$691$728

$798$777

$821

$0

$200

$400

$600

$800

$1,000

2012 2013 2014 2015 2016 2017 2018

U.S. Inforce Premiums ($ millions USD) Canada Inforce Premiums ($ millions CA)

$102 $103$105

$101$104 $104

$93

$0

$50

$100

2012 2013 2014 2015 2016 2017 2018

2018 Life Reinsurance Survey © 2019 Munich American Reassurance Company. All Rights Reserved.

U.S. group life recurring in force premiums

(Top 3 account for 87% of market)

21

0.4

1

8

27

21

37

161

197

326

0.2

1

7

32

32

34

174

212

329

Optimum Re

Canada Life Re

Hannover Life Re

General Re

SCOR Global Life

Group ReinsurancePlus

RGA

Munich Re

Swiss Re

2018

Inforce Premiums ($ millions) 2018 Market Share


Swiss Re, 40%

Munich Re, 26%

RGA, 21%

All Others, 13%

© 2019 Munich American Reassurance Company. All Rights Reserved.

Canada group life recurring in force premiums

(Top 3 account for 94% of market)

22

1

6

26

21

51

3

3

17

19

50

SCOR Global Life

Optimum Re

Swiss Re

RGA

Munich Re

2018 2017

Inforce Premiums ($ millions CA) 2018 Market Share


Munich Re, 54%

RGA, 21%

Swiss Re, 19%

Optimum Re, 4%

SCOR Global Life, 3%

© 2019 Munich American Reassurance Company. All Rights Reserved.

Looking ahead

Many factors will influence future life reinsurance volumes

• Direct life sales, the economy and regulation, in addition to the reinsurance ceding

practices.

• Direct writers’ appetite for financial reinsurance and reinsurance of in force blocks is

not expected to wane in 2019.

• In the U.S., Principle-Based Reserving still presents some uncertainty in terms of

how this reserve regulation will impact life reinsurance.

• Life insurers continue to look for ways to expand insurability to those that are

uninsured or underinsured through the use of streamlined or accelerated underwriting

programs and technology.

• Reinsurers with expertise in these areas are well-positioned to capitalize on the

new life sales generated by these programs.

24© 2019 Munich American Reassurance Company. All Rights Reserved. 2018 Life Reinsurance Survey

Documents

2018 US-Canada Life Reinsurance Survey Results · Many factors will influence future life reinsurance volumes • Direct life sales, the economy and regulation, in addition to the