April 18, 2013

Insurers are divesting their business in US to release capital to fuel Asian growth

Last week, MONY Life Ins. Co. (MONY Life) announced its planned sale to Protective Life Corp. (PLC). In its announcement of the agreement, AXA (parent to MONY Life) highlighted its desire to release resources it had tied up in closed, noncore portfolios and reinvest those resources in higher growth markets and businesses.

 Canadian and European insurers are expected to further rationalize their participation in the U.S. life insurance market in part due to ongoing underperformance and concerns over pending capital regime changes in their local markets (e.g. Solvency II), which could lead to an increase in required capital associated with having U.S. life insurance operations.

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