KKR, Apollo Tap $5.8 Trillion in Japanese Life Insurance for Assets
Global alternative investment firms are gaining access to a new funding stream for their private credit endeavors. Companies, including those managed by KKR & Co. and Apollo Global Management Inc., are closing deals to supervise billions of dollars supporting life and annuity policies within the Japanese life insurance market.
In a process known as reinsurance, Japanese insurers are reducing their risk by transferring some of their liabilities for future benefits to the money managers’ insurance entities. The initial insurers continue to manage and pay out the policies. Yet, in exchange for helping to shoulder the financial commitment, the money managers receive a share of assets from the insurers.
They are betting they can invest those assets to generate returns that exceed future payouts for retirement and death benefits under the policies. A significant portion of this capital is being directed towards the currently popular investment option: higher-yielding private credit.
Kyoto, Japan. Photographer: Trevor Mogg / Alamy
