The Hague May 17, 2023
Net outflows in Variable Annuities amounted to USD 1.0 billion this quarter compared with USD
1.5 billion in the first quarter of 2022, in line with expectations. This is mainly a consequence of lower account values compared with the prior year period as a result of market movements, and outflows related to the lump-sum buyout program for certain variable annuities policies in the first quarter of last year.
Net outflows in the run-off Fixed Annuities book amounted to USD 159 million in the first quarter of
2023 compared with USD 154 million of net outflows in the same quarter last year.
Business update Workplace Solutions
In the US Workplace Solutions business, Transamerica aims to compete as a top-five player in new sales in
the Middle-Market segment of Retirement Plans. As in the Individual Solutions business, Transamerica saw good progress during the first quarter in Workplace Solutions.
Middle-Market written sales
Written sales were USD 2.6 billion in the first quarter of 2023, which is an increase of USD 1.3 billion compared with the same quarter of
2022. The main driver of the increase was a pooled plan sale of USD 1.7 billion that included 1,400 individual employer plans.
Net deposits
Retirement
Plans net deposits amounted to USD 346 million in the first quarter of 2023, while the same quarter last year saw net outflows of USD 34 million.
Net deposits for the Middle-Market amounted to USD 932 million compared with USD 288 million of net deposits in the first quarter of 2022, which reflects the benefits from strong sales in prior periods and lower
withdrawals in this years first quarter.
In the first quarter of 2023, the Large-Market segment of Retirement Plans saw net
outflows of USD 934 million compared with net outflows of USD 588 million in the first quarter of 2022. A portion of the Large-Market withdrawals were retained in individual retirement accounts (IRAs), which generated USD 349 million
of net deposits from asset consolidation and customer retention efforts by the Advice Center in the first quarter of 2023.
New life
sales
New life sales in Workplace Solutions increased by 31% compared with the first quarter 2022 to USD 27 million. This USD
7 million increase was equally driven by indexed universal life and term life sales.
New premium production accident &
health
For accident & health insurance, new premium production was USD 40 million, a decrease of USD 14 million
compared with the prior years quarter mainly driven by lower supplemental health product sales.
Business update Financial Assets in-force management
Financial Assets are blocks of business that are capital intensive with relatively
low returns on capital employed. New sales for these blocks are limited and focused on products with higher returns and a moderate risk profile.
Transamerica is actively managing variable annuities with interest rate sensitive riders, fixed annuities, and long-term care as Financial Assets.
Variable Annuities
The
variable annuity portfolio is a de-risked legacy block that will run off over time. In 2021, Transamerica expanded the dynamic hedge program to cover all guaranteed benefits embedded in variable annuity
contracts. In the first quarter of 2023, Transamerica achieved a hedge effectiveness of 97% for this program, continuing its strong track record of hedging these guarantees against financial market risks. The company does remain exposed to the
impact of equity markets on variable annuity base contract fees.
1Q 2023 Trading
update - 4