Voya Financial Partners with Milliman for Closed Block Variable Annuity Segment Services

Proquest LLC

Voya Financial announced that it has entered into an agreement with Milliman whereby Voya Financial will outsource the actuarial valuation, modeling and hedging functions for its Closed Block Variable Annuity (CBVA) segment to Milliman.

According to a media release, under the agreement, Milliman will perform the calculation of financial reporting and risk metrics, along with the analytics used to determine hedge positions. Voya Financial will continue to oversee and manage the CBVA segment and also retain full accountability for assumptions and methodologies, as well as the setting of hedge objectives and execution of hedge positions.

"Following our move to cease offering variable annuities with guarantee features in 2010, and having also completed significant work to ensure the CBVA segment is appropriately managed to protect regulatory and rating agency capital, we are now taking an appropriate next step by outsourcing certain functions for this run- off block," said Michael Smith, chief executive officer, Insurance Solutions and the executive with management oversight of Voya Financial's CBVA segment. "Our agreement with Milliman allows us to create a more streamlined framework for the CBVA segment and achieve a more variable cost structure for this run-off block."

"By working with Milliman, we will benefit from their talent, hedging expertise, controls and state-of-the-art variable annuity modeling solutions," said Christine Dugan, head of the CBVA segment, Voya Financial. "We will work closely with Milliman to ensure a smooth transition of these functions as well as the continuation of a secure and stable control environment. Importantly, Voya Financial will maintain overall control and oversight of the block."

Voya Financial, which has had a long-term relationship with Milliman, will complete parallel financial closing actions with Milliman prior to final implementation. The transition is expected to be completed in 2015.

Voya Financial, which has rebranded from ING U.S., is composed of retirement, investment and insurance companies serving the financial needs of individual and institutional customers in the United States.