Experienced insurance-linked securities and reinsurance capital markets executive Chris McKeown is returning to the ILS space to join the New Ocean Capital Management Limited ILS investment manager, which was recently launched by XL Group and Stone Point Capital.
Chris McKeown, who was most recently with ILS investment manager Pillar Capital Management, has been appointed as Chief Executive Officer of New Ocean Capital Management. McKeown’s career saw him hold the role of Vice Chairman at broker Guy Carpenter prior to which he led two reinsurers capitalised by hedge fund Citadel Investment Group LLC; CIG Reinsurance Ltd. and New Castle Reinsurance Co. Ltd. He joined Pillar Capital back in May 2012 at the same time as the firm changed its brand from Juniperus.
As well as announcing the hire of McKeown, this announcement also reveals the name of the XL Group, Stone Point launched reinsurance capital markets and ILS management venture. The new ILS asset manager will be called New Ocean Capital Management Limited and will have a mandate to focus on providing third-party capital with access to insurance-linked securities and capital markets based reinsurance-linked investments.
New Ocean Capital Management expects to be up and running, fully operational in time for the upcoming January reinsurance renewal season. From this we can expect that some capital will be deployed, perhaps largely seed at this stage from XL and Stone Point themselves, but this new manager is expected to be actively raising capital in the run up to the renewals as well so it will be interesting to see how much it can accumulate.
James H. Veghte, Chief Executive of XL’s Reinsurance Operations, commented on McKeown’s appointment; “XL and Stone Point Capital are pleased to announce this appointment. Chris brings outstanding experience in managing reinsurance capital markets risk portfolios and building convergence asset management businesses.”
Charles A. Davis, CEO of Stone Point Capital, added; “Chris brings extensive insurance industry experience as an underwriter, broker and investor, and we believe he is an excellent choice to lead New Ocean. We welcome Chris to New Ocean and look forward to building a leading ILS and insurance and reinsurance capital markets investment manager.”
When it was launched, New Ocean Capital was 75% owned by XL with a 25% contribution from Stone Point, with the two expected to maintain their percentage ownerships of the new ILS asset manager. External capital was slated to be raised from third-party investors within a number of ILS fund structures and a collateralized reinsurance entity as well.
New Ocean Capital is also expected to look outside of purely property catastrophe reinsurance risk, as it seeks to offer investors something a little different. CEO of XL Michael McGavick said earlier this year that the new ILS manager would initially focus on lines of business that are traditionally seen in ILS ventures, but that XL would also look to find ways to bring other lines into the ILS asset manager to give investors access to unique risks.
James Veghte, Chief Executive of Reinsurance at XL, also said that the new ILS and reinsurance capital markets unit would look to areas such as retrocessional reinsurance where XL Group is not as active. The focus for New Ocean Capital is expected to be on insurance-linked securities (ILS), index-linked reinsurance as well as making investments in XL Group designed reinsurance products. In this way the unit hopes to offer investors access to the ILS asset universe as well as the returns of more traditional reinsurance products.
The XL Group and Stone Point Capital was an interesting enough venture, bringing together a large and diverse insurance and reinsurance group with a private equity type investor with significant experience in direct reinsurance market investments. XL hired Craig Wenzel as its SVP of Capital Markets, demonstrating its intent in he space, following which the addition of Chris McKeown as CEO of the New Ocean Capital Management ILS unit brings another interesting, and high-profile, dimension to this initiative.