Lincoln National Corp. Reinsurance Negotiations
Lincoln National Corp. (NYSE:LNC) is in advanced talks with Talcott Financial Group to arrange a reinsurance transaction covering roughly $5 billion of universal life policies that carry secondary‑guarantee features. Secondary guarantees ensure that policies do not lapse regardless of their cash value, making them attractive to policyholders but costly for insurers to retain on their balance sheets.
The proposed deal would transfer these life‑insurance reserves off Lincoln’s balance sheet, a move the company says is one of several options to improve free cash flow in its life‑insurance business. Lincoln noted in an emailed statement that it routinely evaluates options that support its strategic objectives and will share information on any transaction decisions when it is able to do so. No definitive agreement has been reached, and the parties may ultimately decide against completing the transaction.
Reinsurance of secondary‑guarantee policies helps carriers mitigate the capital cost of holding such liabilities, freeing capital that can be redeployed to underwrite new annuities and life‑insurance products. Following the Bloomberg report, Lincoln National’s shares rose 2.8% in Monday’s trading session.
This article was generated with AI assistance and reviewed by an editor.