The insurer is working with Morgan Stanley to evaluate options for Jersey City, New Jersey-based Axa Corporate Solutions Life Reinsurance Co., which could fetch $200 million to $300 million in a sale, said the people, who asked not to be identified because the matter isn’t public.
Henri de Castries, the chief executive officer of Paris- based Axa, has been divesting unwanted assets to focus on growth opportunities in emerging markets. Last year, Protective Life Corp. paid $1.06 billion for Axa’s Mony Life Insurance Co., adding a block of life insurance and annuity contracts, most of which were issued prior to 2004. Axa still offers retirement and insurance products in the U.S.
Hartford Financial Services Group Inc., CNA Financial Corp., London-based Aviva Plc and Canada’s Sun Life Financial Inc. are among companies that have made deals to limit risks tied to annuities. The retirement products became toxic for life insurance companies during the recession because their liabilities swell when stock markets decline.
Guggenheim Partners LLC, Apollo Global Management LLC’s Athene Holding Ltd. and Warren Buffett’s Berkshire Hathaway Inc. have all taken on annuity businesses, betting they can better manage funds backing the obligations. Representatives of Morgan Stanley and Axa declined to comment.