People’s Partnership CIO Dan Mikulskis
Dan Mikulskis serves as the Chief Investment Officer at People’s Partnership, provider of The People’s Pension, one of the UK’s largest DC pension fund.
Amy Kessler has had a diverse and successful career in both investment banking and the insurance industry. It is no doubt that varied experience – and her time spent as the founding leader of Prudential Financial, Inc. (PFI)’s international reinsurance business – brought her to her current role as the CEO of the recently launched Prismic Life Reinsurance, a Bermuda-based life and annuity reinsurance company backed by PFI, Warburg Pincus and other global investors.
Launched in late 2023, Prismic leverages PGIM’s and Warburg Pincus’ global investment management capabilities across public and private markets, and is a client of PGIM Multi-Asset Solutions, a newly established affiliate within PGIM that combines asset-liability management expertise with portfolio strategy and asset allocation.
We spoke with Kessler about her start in the industry, the appeal of reinsurance for institutional investors, and a host of other topics.
How did you get started in the industry?
I actually started out focused on international relations and just happened upon international finance as something that fascinated me. I began in the late 1980s in public finance at Lazard Freres, which was a great place to start. I was the financial advisor for the construction of the new Denver International Airport, which opened a lot of doors, and from there I went to Bear Stearns to work on the investment banking team for the City of New York. In 2006, with the passage of the Pension Protection Act in the US, I started to focus on developing the market for Pension Risk Transfer. That brought me to PFI, where our strategy was to insure pension risk in the United States and reinsure pension risk from abroad. Many twists and turns later, I started looking at Prismic in 2021 after more than a decade as the founding leader of PFI’s International Reinsurance business.
Can you offer an overview of how Prismic was formed?
We started on this journey in 2021. We knew we wanted to develop a third-party capital strategy for PFI, and we wanted it to be highly differentiated from strategies others have pursued. We decided to build an independent reinsurance platform, and working with many senior leaders at PFI, the opportunity arose to form a joint venture between PFI and Warburg Pincus, who together with a group of the world’s largest and most sophisticated investors have capitalized and launched the Prismic reinsurance platform. PFI, Prismic, PGIM and Warburg have all come together to execute on the opportunity; PFI originates and administers the insurance policies, Prismic reinsures them, and PGIM and Warburg manage the assets and help us raise capital from our limited partners. To ensure alignment of interest with our investors, currently PFI owns 20% of Prismic, Warburg owns 15%, and investors have a 65% stake.
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I really learned about the vital importance of diversity, equity and inclusion at PFI. I always felt very comfortable to be exactly myself and earned the opportunity to be a diverse leader and run a large business.
Prismic offers institutional investors the opportunity to invest in reinsurance. Can you talk about how the uptake has been in the still-early days of the company?
Investor response to Prismic has been outstanding. In recent years, there has been a tremendous amount of interest among institutional investors in investing in reinsurance. We know a lot of these large investors seek equity interests in specialty reinsurers for their investments. The uptake has been remarkable because what the investors are able to do is come into long, steady, stable reinsurance blocks where we’re investing 90%-plus in fixed income and yet target dividends with an equity-like return. So the earnings opportunity is significant, in a steady, stable way, and our focus of making sure all of the capabilities are native to the platform has resonated with the investment community.
Asset-liability management is obviously a big part of your business. Can you discuss Prismic’s approach to ALM and how PGIM Multi-Asset Solutions supports you in this area?
For every block we take on there are cash flows that we expect to pay out as benefits to policyholders. The first 30 years of cash flows are all inside the investable horizon and we use a combination of public and private fixed income, including fixed income alternatives, to match the cash flows to the first 30 years to the best of our ability. We then use equity alternatives to match the cash flows beyond the 30-year horizon. Derivatives are used to hedge any interest rate risk that isn’t covered by our portfolio.
Talk about the advantages of having PGIM and Warburg Pincus as asset management partners.
PGIM, PGIM Multi-Asset Solutions and Warburg are phenomenal partners for us. As a new reinsurance platform, the ALM and the quality of the public and private assets that we can bring to the platform quickly and at scale is an essential part of our success. To have PGIM, PGIM Multi-Asset Solutions and Warburg come together, we simply couldn’t do better in terms of our asset management and capital raising partners.
Diversity within the ranks of asset management is an important consideration at PGIM, and throughout the industry overall. Can you offer your views on the role diversity plays in your business?
I really learned about the vital importance of diversity, equity and inclusion at PFI. I always felt very comfortable to be exactly myself and earned the opportunity to be a diverse leader and run a large business. What I learned throughout my experience at PFI, where DEI is integral to the culture, is that the very best thing you can do when you have a complicated opportunity is to bring together a very diverse group of people with all different kinds of backgrounds and expertise and empower all of them to speak up and ask questions. The collaboration that comes from putting together that diverse team across many dimensions is foundational to what happens when you’re trying to solve a problem. And while anyone can hire a diverse team, diversity alone isn’t enough. You have to get to inclusion, where people are comfortable speaking up, to ensure that you have fully tapped into the power of your diverse team.
What’s the biggest challenge in your role?
We’ve launched into a very volatile market at a time when there is also tremendous regulatory change. While we’re equal to the task, it is a very dynamic environment from a market and regulatory standpoint. We’re doing our best every day to navigate all of that change.
What do you like to do to unwind outside of the office?
I’m a mom, a chef, a chocolatier, an avid traveler and photographer and I hike with my dog, a nine-and-a-half-pound bichon mini poodle mix. She can hike seven miles and climb large mountains and she’s not to be underestimated.
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