Japan Post Insurance to invest in Global Atlantic reinsurance sidecar

Japan Post Insurance is set to make an investment into a reinsurance sidecar-like co-investment vehicle sponsored by United States life, retirement and annuities insurance and reinsurance company, Global Atlantic Financial Group.

The move comes as part of a tripartite arrangement involving Japan Post Insurance, private equity and buyout giant KKR, and Global Atlantic Financial Group.

KKR acquired Global Atlantic back in 2021, as it sought to deepen its access to the insurance and reinsurance market, as well as asset management opportunities the industry presents.

Meanwhile, Global Atlantic is one of the life and annuity firms to launch a reinsurance sidecar-like co-investment structure to bring third-party capital into its business, to help it expand and earn fees while leveraging the efficiencies of institutional capital within its operation.

This is the Ivy Re reinsurance co-investment and sidecar-like structure that Global Atlantic formed in Bermuda and has since used for supportive third-party capital in a number of major life reinsurance deals.

Today’s news of the tripartite agreement sees a strategic partnership formed between the parties, with KKR and Global Atlantic’s track records on providing solutions for global life and annuity insurance clients expected to help advance Japan Post Insurance’s growth strategy.

Japan Post Insurance will be able to access KKR and Global Atlantic’s platforms, to accelerate growth and diversify its business portfolio into overseas markets.

As part of this, Japan Post Insurance will make what is termed “a material investment” in a reinsurance co-investment vehicle sponsored by Global Atlantic.

The co-investment vehicle is not named, but it’s likely to be the Ivy Re sidecar, or a similar structure established solely for Japan Post Insurance.

It’s an efficient way for Japan Post Insurance to gain exposure to global life and annuity reinsurance, while also funding Global Atlantic to continue its growth path as well.

“We believe this partnership has great potential for Japan Post Insurance to pursue new growth opportunities and diversify revenue sources. It also enhances our reinsurance strategy and asset-liability management capabilities and we will proceed in a gradual and prudent manner as this is the first international partnership for Japan Post Insurance, which currently does not have any overseas offices,” explained Tetsuya Senda, Director and President, CEO, Representative Executive Officer of Japan Post Insurance. “We are very excited to expand our business collaboration with KKR, a leading global investment firm, and Global Atlantic, a leading global life and annuity reinsurance firm, as they are both committed to the Japanese market and trusted partners with whom Japan Post Insurance can develop a mutually beneficial relationship.”

Joe Bae and Scott Nuttall, Co-CEOs of KKR, added, “This is a testament to our continued commitment to expanding our insurance presence alongside high-caliber partners like Japan Post Insurance. We are pleased to enter into this partnership with Japan Post Insurance alongside Global Atlantic to pursue opportunities for growth and collaboration.”

“We are excited about the confidence placed into the Global Atlantic platform by Japan Post Insurance, a leading life insurance company in Japan. It is another sign of the enhanced value we bring to our global reinsurance clients,” Allan Levine, Co-Founder, Chairman & CEO of Global Atlantic also commented. “We continue to see tremendous opportunities to deploy capital, and Japan Post Insurance’s investment in the co-investment vehicle will allow us to further accelerate the growth of our franchise.”