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Marc Rowan, the co-founder and CEO of Apollo Global Management — the parent of Athene — wondered Wednesday about the future of some other life and annuity issuers.
"Not everyone in our industry is doing what they should do," Rowan told securities analysts during a conference call the company held to go over results for the first quarter. "We do worry about contagion."
Rowan alluded to the fact that annuity issuers pay assessments through state guaranty funds when competitors fail.
"We are indirectly responsible for the poor behavior of others," he said. "Every once in a while, when someone does something silly, a bill is delivered to the industry. We are the largest participant in the paying of that bill, and we are tired of writing $100 million and $150 million checks for the stupidity of others."
What it means: Rowan thinks some annuity issuers could fail.
Athene: Athene is now the top issuer of individual annuities, with $34.5 billion in sales in 2025, according to LIMRA.
The backdrop: Financial advisors, regulators and others have wondered whether investment firms like Apollo have made too much use of offshore reinsurance arrangements, complicated investments and cash from the insurance subsidiaries' portfolios to build their operations.
Rowan said that Apollo and Athene have generated high-performing assets, disclosed everything in great detail, and operated mainly in the United States and in other jurisdictions, like Bermuda, that have similar rules.
The market: "There are a number of people who are cutting corners," Rowan said during the call. "Some of the more egregious practices we have seen across our industry do not come from some of the new players. They come from incumbents."
Rowan was especially critical of the arrangements some competitors have in the Cayman Islands.
"Massive amounts of money are being moved to the Cayman Islands," Rowan said. "This is not to say that Cayman itself is a bad place."
But regulators in the Cayman Islands require less transparency than regulators in the United States or Bermuda, Rowan said.
"It will not surprise me to see increased amounts of regulatory scrutiny and perhaps increased requests for capital from those people who have made extensive use of the Caymans," he said.
Allison Bell can be reached at allison.bell@arc-network.com.
Credit: BrunoWeltmann/Adobe Stock
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