MetLife and General Atlantic Form Reinsurance Venture

By David French

NEW YORK (Reuters) – MetLife (NYSE:MET) and General Atlantic are forming a reinsurance venture, executives told Reuters on Wednesday. This venture reflects a growing trend of insurers partnering with alternative money managers to improve returns from low-risk insurance assets.

Details of the Venture

The new venture, named Chariot Reinsurance, will start with an equity contribution of over $1 billion, with MetLife and General Atlantic each holding about 15% ownership. Chariot Re is expected to launch in the first half of 2025 and will be led by Cynthia Smith, who previously headed MetLife's group benefits regional business. Initially, Chariot Re will be seeded with $10 billion worth of existing MetLife policies.

Fellow insurer Chubb (NYSE:CB) will also serve as an anchor investor in the venture, and other institutional investors are in the process of committing funds, according to General Atlantic Chief Operating Officer Graves Tompkins (NYSE:TMP).

Strategic Importance

Tompkins stated, "The high quality, long-duration liabilities that MetLife has been able to offer to Chariot Re align really well with our investment strategy of creating value over the long term without taking principal risk."

This initiative underscores the increasing convergence between the insurance and asset management sectors. Insurers are looking to free up capital for new products by transferring existing policies off their balance sheets. Meanwhile, alternative money managers are in search of steady, low-cost cash from insurance policies to enhance their strategies for high returns.

Both MetLife, through its investment management division, and General Atlantic will manage the assets of Chariot Re, a Bermuda-based life and annuity reinsurance company.

Future assets could potentially come from MetLife, along with significant opportunities to acquire assets from other sources, particularly in the pension risk transfer market. MetLife's Chief Financial Officer John McCallion noted that many large corporations are increasingly outsourcing retirement plan management to reduce costs.

McCallion explained that MetLife recognizes it cannot finance all potential growth alone, making the acquisition of outside capital a logical solution to bridge this gap. "This is coming from the growth opportunity that we see with our business. It's just that we're not going to use our balance sheet for all of it," he said.