In 2011, at least US$12 billion in reserve and embedded value financing transactions related to life insurance-linked securities (ILS) were completed. Most of these transactions involved the financing of redundant reserves for U.S. life insurers selling level premium term insurance subject to Regulation XXX or universal life products with secondary guarantees (UL-SG) subject to Actuarial Guideline 38 (AXXX), with many of these transactions involving the use of bank-issued letters of credit (LOC) to finance the redundant reserves.
In addition to the reserve financing transactions, the market saw at least US$500 million of transactions to transfer catastrophic morbidity or mortality risk, and at least £9 billion of transactions to transfer longevity risk (most such transactions were for UK exposures).