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MetLife Announces $10 Billion Variable Annuity Risk Transfer Transaction

In This Article:

  • Agreement with a subsidiary of Talcott Financial Group to reinsure approximately $10 billion of U.S. retail variable annuity and rider reserves

  • Transaction demonstrates MetLife’s focused execution across New Frontier strategic priorities

NEW YORK, April 30, 2025--(BUSINESS WIRE)--MetLife, Inc. (NYSE: MET) today announced it has entered into an agreement with Talcott Resolution Life Insurance Company (Talcott), a life insurance and annuities subsidiary of Talcott Financial Group, to reinsure approximately $10 billion of U.S. retail variable annuity and rider reserves.

The combined value of the transaction is expected to be approximately $250 million consisting of both ceding commission and capital released over time.

The planned reinsurance transaction with Talcott is aligned with MetLife’s disciplined evaluation of risk transfer options within MetLife Holdings, the closed-block businesses of the company’s former U.S. Retail segment. The transaction will accelerate the run-off of MetLife’s legacy business and is the latest example of executing across the company’s New Frontier strategic priorities.

MetLife anticipates that the transaction will positively reduce the company’s enterprise risk associated with capital markets. Importantly, the transaction will significantly lower the company’s retail variable annuity tail risk by reducing account values by approximately 40%.

Expected foregone annual adjusted earnings total of approximately $100 million will be offset by annual hedge cost savings of approximately $45 million.

"This transaction represents another tool in our toolkit that is available to generate long-term value," said MetLife President and CEO Michel Khalaf. "It will reduce enterprise risk and bolster MetLife’s position as a fundamental, all-weather performer. Our capacity to lower risk and successfully navigate uncertain and changing environments benefits our shareholders and all our other stakeholders."

Summary

  • MetLife plans to reinsure approximately $10 billion U.S. variable annuity and rider reserves with Talcott.

  • As part of MetLife’s ongoing commitment to its policyholders, the company will continue to be responsible for all customer-related functions.

  • The reinsurance transaction is structured on both a modified coinsurance and a funds withheld basis.

  • The transaction is expected to close in the second half of 2025. The consummation of the closing under the agreement is subject to the satisfaction or waiver of customary closing conditions specified in the agreement, including the receipt of required regulatory approvals.