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Can new capacity for variable products with guarantees arise like the phoenix out of the ashes of a badly burned life reinsurance market?
Although interviews with National Underwriter suggest doubt about a rebirth, one life actuary says that if transactions are properly structured, guarantees in variable annuities and life products can be reinsured.
Michael Pado, president and CEO of Convergence Re LLC of Oceanport, N.J., is awaiting word from potential investors on whether there is enough interest to raise capital to offer reinsurance for both guaranteed living and death benefits on variable products.
After about 10 months of work, Pado says he should know if there is interest in the project within a couple of months.