Legal and General launch pension risk blockchain
U.K.-based Legal and General (L&G), the U.K.’s number one retail life insurer, announced it’s launching a blockchain solution for pension risk transfer through Legal and General Reinsurance. The group has more than a trillion pounds ($1.27 trillion) in assets under management.
One often hears of large companies with pension deficits. The assets they have accumulated to support their defined benefit pension schemes are less than the liabilities for pension annuities. That’s often the result of investment returns differing from earlier predictions. One way to address the issue is to get an insurer to take on the risk of a shortfall, so-called pension risk transfer (PRT).
Legal and General had several separate systems that dealt with PRT and created a blockchain system that handles the entire reinsurance process. That includes pricing, claims handling, financial reporting and collateral. The new system dubbed ‘estua-re’ should lower long term costs, and according to the company, it will redefine how long term life reinsurance business is sold.
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