COIN Reinsurance has been launched as a new Florida based property reinsurance broker, with a goal to disrupt the standard market practice way of doing business and reduce the costs of reinsurance as a result.
Founded by E.W. “Ted” Blanch, former CEO of E.W. Blanch, the company believes that catastrophe reinsurance economics have been tipped in the favour of reinsurers for decades and it’s time to disrupt this status quo by better aligning client and broker interests with those of the ultimate insurance consumer.
Blanch and his team have founded Tampa, Florida-based COIN Re. The name of the company is an acronym of Client Owned Intermediary Nexus, and the firm targets a pricing and ownership model that it says is “radically different from reinsurance broker industry norms.”
COIN Re has partnered with reinsurance broking firm The Beach Group to help it achieve this goal, with a range of services available to COIN Re’s clients through the Beach platform.
COIN Re has a goal of reducing the overall cost of reinsurance in the property field, through lower reinsurance premiums, reduced frictional cost, and by offering shared ownership of the firm to its client insurers.
Ultimately, the company wants to enable insurance companies to reduce their operating costs with these benefits passed onto the insurance consumer.
“We’re creating a new paradigm and disrupting the status quo,” Blanch explained. “For example, we will provide the full range of brokerage and analytic services—but we’re willing to unbundle them and charge accordingly. We will be very aggressive in reducing reinsurance spend and net cost, as well as in reducing frictional cost. And we’ll offer an ownership interest to clients which, if taken up, will provide returns through revenue distribution and equity value accumulation.”
The notion of lowering reinsurance costs is unlikely to sit so well with any traditional reinsurers who are struggling to generate returns above cost-of-capital currently.
But it does sit well with both reinsurers and insurance-linked securities (ILS) players who recognise the need to reduce the frictional costs in the reinsurance transaction more generally.
Through the partnership with Beach Group, COIN Re will aim to offer clients access to the insurance-linked securities (ILS) market, with placement and other structuring and advisory services available.
Overall though, the company wants its new model to provide clients with benefits that tip the market economic of reinsurance back towards the ceding companies, giving improved reinsurance program pricing, reduced frictional costs, as well as revenue distribution and equity value accumulation back to the insurance companies that become shared owners in the firm.
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