30 January 2018Alternative Risk Transfer

Aetna strikes $200m Vitality Re IX health ILS deal

Health insurer Aetna has entered into a four-year reinsurance arrangement with Vitality Re IX as part of its long-term capital management strategy, according to a Jan. 29 press release.

This transaction marks the completion of Aetna's ninth reinsurance arrangement under the Vitality Re programme.

The arrangement allows Aetna to reduce its required capital and provides $200 million of collateralized excess of loss reinsurance coverage on a portion of Aetna’s group commercial health insurance business.

Vitality Re IX is a newly formed insurance company which issued health insurance-linked notes in a private offering in connection with this transaction.

“Today’s transaction marks the successful completion of our ninth reinsurance arrangement under the Vitality Re program,” said Aetna Treasurer David Buda. “The Vitality Re programme remains an integral component of our capital structure by lowering our cost of capital and driving capital efficiency.”

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More on this story

Insurance
29 November 2018   Fitch Ratings has downgraded the Insurer Financial Strength (IFS) ratings of health insurer Aetna to 'A' from 'AA-'.
Insurance
24 October 2017   Property/casualty insurer The Hartford has entered into a definitive agreement to acquire Aetna's US group life and disability business for a cash consideration of $1.45 billion.
Insurance
30 January 2017   Health insurer Aetna has entered into a four-year reinsurance arrangement with special purpose vehicle Vitality Re to transfer risk into the capital markets as part of what it called its long-term capital management strategy.