Aon and Blackstone funds launch Cortina, a new Lloyd’s syndicate offering efficient reinsurance

Aon’s agreement with Blackstone over the much-discussed reinsurance facility at Lloyd’s named Cortina was signed this week and now the parties have announced its launch, while the London Bridge 2 insurance-linked securities structure appears to have been utilised in the funding of the new syndicate.

We had been told the Cortina transaction effectively closed late Wednesday this week, after contractual agreements were approved and signed among the parties involved.

Sources have said the agreement covers somewhere around $1.6 billion of premiums, while funding had been mooted at around the $500 million level.

Now, Aon and Blackstone have formally announced the launch of the Cortina syndicate at Lloyd’s, revealing that the London Bridge 2 ILS structure was part of the initiative.

The structure is designed to offer efficient long-term reinsurance capacity to Aon’s clients, while they will also benefit from a client dividend.

Cortina is expected to begin underwriting from January 1st 2027 adopting a lead/follow approach, subject to final approval from Lloyd’s, while QBE will be managing agent of the syndicate and be responsible for the syndicate’s underwriting and governance.

“As risks grow in scale and complexity, clients are looking for effective risk transfer solutions that consider all forms of available capital,” explained Greg Case, President and CEO, Aon. “Cortina is bringing additional, long-term capital through Blackstone together with QBE’s expertise and the strength of Lloyd’s to expand the market’s capacity to take risk, help close protection gaps and enable greater resilience, investment and growth.”

“The partnership with Aon and QBE will broaden the pools of capital available to the reinsurance market, expanding capacity and strengthening resilience across market cycles,” added Jon Gray, President and Chief Operating Officer, Blackstone. “We remain strong supporters of continued innovation at Lloyd’s and are long-term investors in the sector. This partnership will help meet clients’ evolving needs while supporting the market’s long-term growth.”

“Cortina is a first-of-its-kind model for reinsurance capacity at Lloyd’s,” Jason Harris, QBE International CEO said. “As managing agent, we bring deep, specialist underwriting expertise and our leading Lloyd’s capability to a syndicate that combines long-term institutional capital with stable, disciplined reinsurance capacity. It also gives us the opportunity to further grow our business through an innovative model. For QBE Re, the strategy remains unchanged: a continued focus on building long-term partnerships.”

“Lloyd’s takes pride in being a market of firsts and in being the most capital-efficient marketplace in the world to connect capital to insurance risk,” commented Patrick Tiernan, Chief Executive, Lloyd’s. “By structuring this transaction at Lloyd’s, we see the marriage of new long-term capital through our London Bridge 2 framework, with the highest underwriting and oversight standards to create long term value for clients, investors and the marketplace. This is total innovation in action.”

QBE is already partnered as a lead with Aon on its Client Treaty facility at Lloyd’s, which was renewed earlier this week with an expanded remit to provide 35% co-insurance of eligible business placed through Aon’s Global Broking Centre and facultative reinsurance business in the market for 2027, an increase from 28.5% co-insurance in 2026.

Cortina is designed to bring institutional third-party capital to support reinsurance of a meaningful slice of Aon’s brokered book in the market.

Aon said the Cortina syndicate will offer following capacity on all eligible treaties, subject to a framework. This will include following lines of 3% on property catastrophe treaty business and 5% on other treaty lines.

Aon’s CEO Greg Case has referred to Cortina a number of times recently, explaining at a KBW conference that the structure will enable Blackstone to participate in a broad portfolio of risks through a Lloyd’s syndicate.

As Aon has established follow-capacity in that market for some year’s now, through its Aon Client Treaty, it’s likely the follow-lines will be originated, underwritten and delivered to Cortina in a similar manner.

Cortina has stimulated quite the debate in the reinsurance market, with some questioning the need for more capacity in the market at this time of high competition and softening rates.

At Lloyd’s itself, it appears to have perhaps been a contributor to the market issuing recent guidance on its expectations for any broker-originated reinsurance structures and facilities, a strategy that Lloyd’s said is likely to see increasing demand given capital’s interest in accessing the marketplace.

Ultimately, Cortina demonstrates the appetite of major institutional investors to access returns of the reinsurance business in the most efficient manner possible.

By gaining access to a slice of perhaps the biggest brokered book around and the agreement now said to be signed, it seems Blackstone has secured another route to expand on its insurance investments in the Lloyd’s market.

Previously, just in the last year, we’ve seen Blackstone partner with The Fidelis Partnership on Syndicate 2126, while also partnering with AIG on Syndicate 2479, which was that insurer’s second such vehicle after the also Blackstone-partnered Syndicate 2478.

Cortina will expand access to reinsurance-linked returns via Lloyd’s for the asset manager and its investors, while also expanding the increasingly important role of institutional capital in the Lloyd’s marketplace.