In an effort to improve corporate governance and facilitate compliance with regulatory mandates, MetLife has merged four of its previously independent subsidiaries. Three of the subsidiaries— MetLife Insurance Company of Connecticut, MetLife Investors USA Insurance Company, MetLife Investors Insurance Company —marketed variable annuities. The fourth, Exeter Reassurance Company Limited, was an offshore captive reinsurer. The merged company has been named MetLife Insurance Company USA.
The merger will make it easier for MetLife to comply with Dodd-Frank collateral requirements and avoid potential regulatory issues associated with the use of captive reinsurance companies. By combining the companies, MetLife will also gain better visibility into its overall domestic variable annuity portfolio, which should help it better manage risk and pinpoint opportunities for improved portfolio performance.
The merger is part of MetLife’s broader strategy to de-risk its extensive variable annuity business.
Some regulators have expressed concerns about captive reinsurance as a means of reducing reserve requirements. These concerns may lead other insurers to follow MetLife’s lead.
The merger will not affect the terms, conditions or benefits currently in force for any policies, contracts or accounts with the affected subsidiaries.
