There are plenty of official press releases on this sale, announced on Wednesday of this past week, describing the transaction by which Allstate sold off it's variable annuity block of business to Prudential Life.

The transaction is pretty straight forward, with the VA block, with net assets of approximately $16 billion and a sale value of $540,000,000 will transfer to Prudential, which already has $54 billion in assets under management in variable contracts. The transaction will move Prudential to number 3 in total VA assets behind Met Life and Hartford, but what I find really intriguing about the deal is the selling and marketing arrangements that go along with it. They are in brief:

1. Allstate gets a two year window during which it can sell FIXED annuities through the Prudential sales network.

2. Prudential Life gets a distribution agreement for variable annuities through the Allstate agent and financial institution network.

3. Prudential will get access for the first time to the Morgan Stanley investment clients through Allstates long standing partnership with the investment bank, thus giving them access to a higher level of professionals in the fund management business.

I've often wondered when the life markets were going to begin to realize that not every company needs to own and develop every product, and that sharing distribution networks and "cobranding product" was a win-win for every one. I think there are some very logical candidates for similar deals in the settlement industry where cobranding of niche product and access to selling groups might make a great deal of sense. Only time will tell if that ever occurs.