Manulife Closes LTC Reinsurance Transaction with RGA

Rhea-AI Summary

Manulife (MFC) has successfully completed its previously announced reinsurance transaction with Reinsurance Group of America (RGA), covering two blocks of legacy business, including a younger block of long-term care (LTC) insurance. This marks Manulife's second significant LTC reinsurance transaction, demonstrating the company's prudent approach to LTC reserves and assumptions.

According to CEO Roy Gori, this strategic move aligns with Manulife's commitment to enhancing shareholder value and restructuring its portfolio towards higher returns with lower risk profiles. The company has now successfully reinsured both mature and younger LTC blocks.

Positive

• Strategic risk reduction through reinsurance of LTC blocks
• Portfolio optimization towards higher return and lower risk assets
• Validation of LTC reserves and assumptions through successful transaction

Negative

• Potential reduction in direct premium income from reinsured blocks

TSX/NYSE/PSE: MFC SEHK: 945                                                                              C$ unless otherwise stated

TORONTO, Jan. 02, 2025 /PRNewswire/ - Manulife announced today that it has closed¹ the previously announced transaction to reinsure two blocks of legacy business, including a younger block of long-term care (LTC), with Reinsurance Group of America ("RGA").

"With this second milestone LTC reinsurance transaction, we have now reinsured both mature and younger LTC blocks, further validating our prudent LTC reserves and assumptions," said Manulife President and Chief Executive Officer Roy Gori. "Additionally, this transaction reaffirms our commitment to unlocking shareholder value and further reshapes our portfolio to higher return and lower risk."

For more information on the transaction, please see the news release, slides and webcast from our November 20^th, 2024, announcement.

About Manulife

Manulife Financial Corporation is a leading international financial services provider, helping people make their decisions easier and lives better. With our global headquarters in Toronto, Canada, we provide financial advice and insurance, operating as Manulife across Canada, Asia, and Europe, and primarily as John Hancock in the United States. Through Manulife Wealth & Asset Management, we offer global investment, financial advice, and retirement plan services to individuals, institutions, and retirement plan members worldwide. At the end of 2023, we had more than 38,000 employees, over 98,000 agents, and thousands of distribution partners, serving over 35 million customers. We trade as 'MFC' on the Toronto, New York, and the Philippine stock exchanges, and under '945' in Hong Kong.   

Not all offerings are available in all jurisdictions. For additional information, please visit manulife.com. 

FOOTNOTES
1.	The effective date of the transaction is January 1, 2025.

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SOURCE Manulife Financial Corporation

FAQ

What is the significance of Manulife's (MFC) latest LTC reinsurance transaction with RGA?

The transaction represents Manulife's second major LTC reinsurance deal, validating their LTC reserves and assumptions while reshaping their portfolio for higher returns and lower risk.

How does the January 2025 RGA reinsurance deal affect Manulife's (MFC) risk profile?

The deal reduces Manulife's risk exposure by reinsuring younger LTC blocks, contributing to a lower-risk portfolio structure.

What blocks of business are included in Manulife's (MFC) latest reinsurance transaction?

The transaction includes two blocks of legacy business, specifically featuring a younger block of long-term care (LTC) insurance.

How many major LTC reinsurance transactions has Manulife (MFC) completed as of 2025?

Manulife has completed two milestone LTC reinsurance transactions, covering both mature and younger LTC blocks.