September 11, 2024

Corebridge Financial on its own and moving to dominate the market

Corebridge Financial begins corporate life free from the shadow of American International Group in a strong position to attack the massive retirement market.

“Peak 65 I think, essentially defines our marketplace,” said Kevin Hogan, Corebridge CEO. “The fact that 4 million people are going to 65 each year for the next decade, each of our businesses serves needs directly related to that macro trend.”

Corebridge is the former AIG Life & Retirement business and is wrapping up a years-long separation. It started corporate life as the No. 2 seller of annuities behind Athene Annuity & Life, and took on a $3.8 billion investor in Nippon Life, Japan’s largest life insurer, earlier this year.

It adds up to heady times for a new company serving a huge market, Hogan said during a “fireside chat” Tuesday at the Barclays 22nd annual Global Financial Services Conference. The event served as another chance for Hogan to play up Corebridge as a strong investment.

And Corebridge shares up up more than 19% year-to-date, as of Wednesday morning.

“We’re focusing on executing on our strategies, delivering on our commitments and maximizing shareholder value,” Hogan said. “We have a very strong foundation off of which to build. We have multiple products, multiple channels, and four market-leading businesses, each of which has a very strong distribution platform.”

New RILA coming

Hogan announced that Corebridge will bring a registered indexed-linked annuity to market this year, adding to its massive-selling product shelf.

Corebridge closed the gap on Athene in the first half with nearly $14.5 billion in annuity sales, according to LIMRA’s Fact Tank.

The four Corebridge business segments are: Individual Retirement, Retirement Services, Life Insurance and Institutional Markets. Corebridge is focused on growing its wealth management business, Hogan explained, which has 1.9 million customers in group retirement and 1.7 million yet to retire.

“We serve during the in-plan period, while those participants are working, but then we have the ability to build a relationship with them, to serve them after they retire,” Hogan said. “So, that’s a huge opportunity for our field force of advisors to build relationships and to serve that wealth management opportunity over time.”

The addition of a RILA will only add to a strong network marrying diverse products with strong distribution, Hogan said.

Stunning Q2 results

Corebridge stunned Wall Street analysts with a second-quarter earnings report showing premium and deposits growing 68% to nearly $6.8 billion. That growth came mainly off strong fixed annuity sales during a quarter that saw LIMRA report some fixed annuity sales declines across the industry.

“We have great relationships with our distribution partners,” Hogan said Wednesday, “and our strategy is to understand not just what they want on the shelf one or two quarters from now, but what their strategy calls for one or two years from now. This allows us to start to build products and services now, to support their strategies then.”

Also during Q2, Corebridge received regulatory approval to cede business to its Bermuda reinsurer. It is an option the company is eager to explore, Hogan said, and began by “reinsuring part of our new business sales of fixed annuities and indexed annuities.

“We’re always looking for opportunities to optimize our regulatory capital, and we see Bermuda as the next tool in our toolkit,” he added.

AIG announced acticipated plans to spin off its Life & Retirement division in March 2022.

After spinning off Corebridge through a successful IPO in September 2022, AIG reduced its holdings in Corebridge through a series of transactions. AIG currently owns approximately 48.35% of Corebridge Financial’s common stock.

Once the Nippon Life sale closes, anticipated in the first quarter of 2025, AIG will maintain a 9.9% stake in Corebridge for two years, the insurer has said.

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