Swiss Re Insurance-Linked Fund Management

Original Risk: A Society for Change Agents

1347 PIH names Swets CEO, reveals $237.75m SPAC connection


1347 Property Insurance Holdings, Inc. continues its transition towards a strategy focused on reinsurance and investment management and has now named interim CEO Larry Swets as its new permanent CEO, while also announcing a name change to FG Financial Group, Inc.

fundamental-global-1347In addition, the company which is converting to a reinsurance and investment management focused holding company, has also revealed that it has invested in and is connected to a recently launched and IPO’d special purpose acquisition company (SPAC) that will have a focus on fintech, insurtech and other disruptive technology opportunities.

New permananet CEO Larry Swets has worked across a range of financial services, insurance and reinsurance organisations at key times in their history, helping to drive strategic shifts and turnarounds, with experience gained in insurance-linked securities (ILS) through the establishment of Insurance Income Strategies Ltd., a vehicle that had backing from 1347 Advisors and Kinsgway Financial, a former employer.

1347 Property Insurance Holdings (1347 PIH) then sold its homeowners insurance underwriting operations to Florida and region focused primary insurance group FedNat Holding Company towards the end of 2019, taking an investment and reinsurance arrangement with the carrier.

1347 PIH also said it was planning to transition into a holding company, offering reinsurance and investment management services, while also revealing a lucrative five-year first-refusal arrangement for up to 7% of any layer of FedNat’s reinsurance program renewals.

Swets will now take on permanent responsibility for leading 1347 PIH throughout the its transition to FG Financial Group (Fundamental Global), in alignment with the company Kyle Cerminara, Chairman, had previously founded, registered investment advisor Fundamental Global Investors.

Two investment funds have been launched to support the SPAC, or blank-check company, which will result in FG putting a total of $8.6 million of risk capital to work in the launch of the SPAC, named FG New America Acquisition Corp.

FG New America Acquisition Corp has already completed a successful initial public offering (IPO) and has listed on the New York Stock Exchange (NYSE) and former chairman of the board at TD Ameritrade Joe Moglia has been named its Chairman, while Swets is CEO, and Kyle Cerminara President.

The capital raise came to $225 million through the initial offering of shares, plus another $12.75 million was sold to the underwriters, for a total gross proceeds of the capital raise of $237.75 million.

FG New America Acquisition Corp will focus on “identifying businesses in the insurance and financial services industry, with particular emphasis on businesses that are providing or changing technology for traditional financial services (“FinTech”), insurance (“InsureTech”), or other sectors where disruptive and/or adaptive technology or other factors are driving changes in a new era in the American business landscape,” the company explains.

It’s going to be interesting to see how the overall FG Financial Group evolves under the steering of Swets as CEO, given it has reinsurance, investment and insurtech focuses, plus a clear ability to attract third-party capital and now a holding company platform that would allow it to pursue more innovative business models, should it choose to.

Such platforms can provide an effective way for investors to access the returns of the insurance and reinsurance market, in a manner focused on the kind of growth opportunities seen in venture investing as well.

As a the insurance market value-chain looks set to be altered completely over the coming years, as we believe the alteration has barely begun at this stage, FG could be well-positioned to capitalise on opportunities that change is going to present to those with capital and a strategy to support its deployment.

Register today for ILS Asia 2023, our next insurance-linked securities (ILS) market conference. Held in Singapore, July 13th, 2023.

Artemis ILS Asia 2023 - Insurance-linked securities conference in Singapore

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