Hedge fund strategy reinsurer Till Capital signs up to MultiStrat Re

by Artemis on August 12, 2014

Bermuda domiciled hedge fund style reinsurance and hybrid investment platform Till Capital Ltd., the parent company of reinsurer Resource Re Ltd., has signed two agreements with asset manager reinsurance platform Multi-Strat Re Ltd.

Under the two agreements which Resource Re and Multi-Strat Re have entered into, Multi-Strat Re will provide certain underwriting and retrocession services to Till Capital. The Multi-Strat Re platform, a Bermuda-based special purpose insurer, is designed to make it easier for asset managers and hedge fund managers to enter the reinsurance sector by lowering barriers to entry and minimising the start-up capital required.

Till Capital expects working with Multi-Strat Re will help it to gain entry to the reinsurance market at an earlier stage, with less capital required upfront. Using Multi-Strat Re allows asset managers to access the reinsurance market with less-friction, reduce their up-front capital and expenses, leverage experienced underwriting and leadership resources, generate premiums for investment float and launch and grow their own independent reinsurance companies.

The first agreement the two firms have entered into is a Master Services Agreement, which sets out the terms and conditions of the underwriting, collection and processing of premiums and claims services to be provided by Multi-Strat Re to Resource Re, as well as other tax and administrative functions.

The second agreement entered into is a Retrocession Agreement, under which Multi-Strat Re agrees to retrocede to Resource Re a specified quota share of certain insurance and reinsurance business that it assumes, meeting the terms and conditions for risk and financial limits as pre-defined by Resource Re.

“Signing these agreements marks our transition to a reinsurance company,” commented William M. Sheriff, Till Chairman and CEO. “We look forward to working closely with the MSRE team in building the Company’s reinsurance asset base.”

“Our original partnership with Resource Re is now greatly enhanced by Till Capital’s ownership of Resource Re and its commitment to the MSRE platform. We are excited to work with the Till Capital team as it builds Resource Re in Bermuda,” added Bob Forness, Multi-Strat Re Chairman and Chief Executive Officer.

Till Capital has also appointed KPMG Audit Limited in Bermuda as the firms auditor as well as retaining the services of Renmark Financial Communications Inc. for some of its investor relations activities.

Till Capital has an interesting and unique strategy, to operate a reinsurance business with a diversified, hybrid investment strategy on the back-end. Primarily, Till Capital is in the reinsurance business which gives the firm access to reinsurance premiums, or float, which it then invests in its investment strategies which have an emphasis on natural resources (hence the name Resource Re).

Signing this new agreement with Till Capital should see Multi-Strat Re continue to grow its operations and the amount of premiums it can underwrite and thus cede to participating asset manager-backed reinsurers. The platform expects to sign up a number of new asset managers every year, capitalising on the interest in reinsurance from hedge fund and alternative investment managers.

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