Bermudian-based Fortitude Re has announced the signing of a reinsurance transaction between its subsidiary, Fortitude Reinsurance Company Ltd, and Unum Life Insurance Company of America, which is a subsidiary of Unum Group.

Upon receipt of regulatory approvals and subject to satisfaction or waiver of certain other customary closing conditions, Unum will cede to FRL, effective as of January 1, 2025, $3.4 billion of individual long-term care statutory reserves and approximately $120 million of Unum Group’s multi-life individual disability insurance in-force premium.

Fortitude Re said the cession represents 19 per cent of Unum Group’s total LTC block and 20 per cent of its in-force IDI premium.

Unum will continue to service and administer the reinsured policies.

Simultaneous with the closing of the reinsurance transaction with Unum, FRL will enter into an agreement to retrocede 100 per cent of the LTC and IDI insurance risks to a highly rated global reinsurance partner.

Fortitude Re said FRL will therefore retain only the underlying spread-based risks associated with this block of business.

“Today’s announcement underscores the deliberate approach we have taken towards growth,” said Alon Neches, the Fortitude Re chief executive.

“When partners like Unum place their trust in us, we ensure the value delivered honours that trust. I would like to extend a special thank-you to the many professionals who have collaborated and worked tirelessly to achieve this important milestone.”