Swiss Re Insurance-Linked Fund Management

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Brit’s Sussex Capital targets doubling of premiums, ~$250m AuM in 2019


Specialty insurer and reinsurer Brit Ltd. has targeted a doubling of written premiums for its Sussex Capital collateralised reinsurance fund platform in 2019, which would equate to growth to around $250 million of assets under management.

brit-logoWe have learned that Sussex Capital has been marketing its insurance-linked securities (ILS) funds in early 2019, as it plans to capitalise on the rate environment and the access to reinsurance business it has through parent Brit, in order to achieve growth through this year.

The company had explained last year that its managed capacity, across the Sussex Capital collateralised reinsurance platform, Versutus collateralised reinsurance sidecar, and Lloyd’s syndicate 298, had risen to $400 million.

The company then said it had grown that to around $440 million, after a renewal of the Versutus sidecar for this year took the vehicle to $190 million.

The total managed capital was based on assets under management at Sussex Capital of just over $105 million at the time we understand, but the target is to grow that significantly through 2019, with the mid-year renewals a likely source of further expansion for the platform.

Jon Sullivan, Brit’s Deputy Global Chief Underwriting Officer (CUO), told us earlier this year that the company has “ambitious plans” for the Sussex Capital unit, looking to leverage the enlarged platform it has created with the addition of Sussex Capital UK PCC Limited, the first registered and licensed multi-use collateralised reinsurance PCC vehicle in the UK.

Now we’ve learned that these ambitions extend to a more than doubling of gross written premiums at Sussex Capital, as well as a more than doubling in assets under management, by the end of 2019.

The Sussex Capital Diversified Fund is the main strategy within the platform and it targets both open market property catastrophe risk, as well as writing a quota share of business from parent Brit’s syndicate 2987 as well, also largely natural catastrophe treaty risk based.

The target return is 6% to 8%, above the risk-free, over the longer-term and through the market cycle, we understand, while hedging is designed to mitigate any downside for investors as well.

By leveraging the significant market reach and portfolio of Brit, Sussex Capital has good access to source new business and benefits from the underwriting expertise within its parent as well.

This particular Sussex Capital Diversified Fund strategy wrote over $22 million of gross premiums in 2018, we’re told, but for 2019 the ambition is to write more than $50 million, so significant growth.

Basing that $22 million on the 2018 AuM of around $105 million, it’s clear to see that growing its assets to as much as $250 million will be required for the premium growth targets to be achieved.

It’s good to see the Sussex Capital platform planning to become an increasingly meaningful player in the market and contributor to Brit’s own growth. It will be interesting to hear about its success, or otherwise in what has been a challenging fundraising year.


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