Ark Insurance Holdings Limited, a property and casualty insurance and reinsurance subsidiary of the White Mountains Insurance Group, Ltd., has succesfully sponsored a $250 million collateralized reinsurance sidecar Outrigger Re Ltd.
The Outrigger Re sidecar has been formed to provide collateralized reinsurance capacity for Ark’s global property catastrophe portfolio.
Outrigger Re Ltd., which is a recently-formed Bermuda company registered as a special purpose insurer (SPI) and segregated accounts company, has entered into a quota share reinsurance arrangement with Ark.
The quota share arrangement will provide reinsurance protection on a portion of Ark Bermuda’s global property catastrophe reinsurance portfolio, from on January 1st 2023.
Media rumours had suggested the capital raise would be $300 million, but it seems this may have fallen short, as $250 million of total investor capital has been secured, $205 million of which came from White Mountains itself.
Additional investments came from Aquiline Capital Partners and a subsidiary of Enstar Group Limited, the company explained.
It’s perhaps telling of the challenging environment for raising money for retrocessional sidecar vehicles, that the majority of the capital in this case seems to have come from existing and former backers of Ark, White Mountains and Aquiline.
It hasn’t been easy to raise money for sidecars again this year, but this pool of collateralized capacity will support Ark’s continued expansion into the hardening reinsurance market.
Manning Rountree, Chief Executive Officer of White Mountains, commented, “We are pleased to launch Outrigger Re, deploying capital into the hard market for property catastrophe insurance and in support of the exceptional underwriting team at Ark.”
Ian Beaton, Chief Executive Officer of Ark, added, “This transaction represents an important source of strategic underwriting capacity to support our core clients at a dynamic time in the reinsurance cycle.”
TigerRisk Capital Markets & Advisory was the structuring and placement agent for this new Ark sidecar transaction, while Sidley Austin LLP and Conyers Dill & Pearman Ltd. provided legal counsel to the parties involved.