The new combination - called JRP Group - will begin trading on the London Stock Exchange today, after finalising its scheme of arrangement merger in the High Court on Friday.
JRP Group will have a market cap of £1.4bn and assets under management of more than £15bn.
Management said the move would strengthen the position of the enlarged group in the UK, give it the scale to develop new retirement products and expand overseas.
The industry has been looking for new revenues since new legislation brought in by Chancellor George Osborne last April allows pensioners to retire without having to buy an annuity, which provides a life-long income.
Annuity pension sales have fallen by more than half across the industry, and both firms had seen their profits and share prices hit hard by the changes.
Under the terms of the merger, Just Retirement will own 60% of the new firm, with Partnership Assurance shareholders owning the rest of the business.
The new firm will be run by Just Retirement chief executive Rodney Cook and chaired by Partnership Assurance's chairman Chris Gibson-Smith.
Cook said: "I am delighted the merger process between Just Retirement and Partnership has been concluded and JRP Group is now established."
The deal was first agreed last August.
The firm said it expects annual cost savings of £40m from 2018, although it expects to incur integration costs of £60m spread over two years.