* The units with 56 bln euro in assets are in run-off
* Willis Towers Watson acting as a sellside adviser - sources (Adds detail, background)
FRANKFURT, Sept 26 (Reuters) - German reinsurer Munich Re’s Ergo unit is considering options for its insurance businesses Victoria Leben and Ergo Leben, which have ceased underwriting new business, it said on Tuesday.
“We are seeking detailed information on how large the interest (in these assets) is and if we can achieve a viable solution as well as an attractive price,” an Ergo spokesman said.
He added that no decision had been taken if or at which price Ergo would sell the so-called run-off life portfolios.
Willis Towers Watson has been mandated as a sellside adviser for the life insurers, two people familiar with the matter said, adding that the process is at a very early stage.
Ergo’s run-off life portfolio has 6 million customers and assets of 56 billion euros ($66 billion).
Originally, Ergo had wanted to carry out the run-off itself.
But markets for these assets have picked up since mid-2016, the Ergo spokesman said.
Ergo board member Clemens Muth on Tuesday said in a memo to staff: “This (management of insurance portfolios could be done) within our group or externally”, he said.
Ergo and fellow insurers are struggling to pay guaranteed returns to clients because of record-low interest rates. Combined with more stringent European capital rules, these have prompted some to offload life insurance operations.
Financial services groups specialising in the run-off of life insurance are vying for these portfolios. They acquire policies until their expiry and aim to turn a profit by measures such as cutting administrative costs.
Peer Generali earlier this year put its 44 billion euro German life insurance portfolio up for sale as it restructures in Europe, sources familiar with that deal have said.
The sales of the Ergo and the Generali portfolios would mark the largest closed books sale ever. Dutch insurer Aegon sold a 9 billion pound book of closed UK life business last year and Britain’s Standard Life has said it is open to the sale of its 16 billion pound closed annuity portfolio.
In Germany, only a handful of smaller portfolios of the roughly 90 life insurers have changed hands, including those of Arag Leben, Delta Lloyd, Basler Leben, Heidelberger Leben and Skandia.
German firms such as Viridium - owned by Cinven and Hannover Re - and Fosun-backed Frankfurter Leben have shown interest closed books, as has Bermuda-based Athene.
Willis Towers Watson was not immediately available for comment. ($1 = 0.8478 euros) (Reporting by Arno Schuetze and Alexander Hübner; Editing by Georgina Prodhan/Jeremy Gaint)