Swiss Re Insurance-Linked Fund Management

Original Risk: A Society for Change Agents

Church of England investor enjoys reinsurance linked returns with CATCo


The range of investors accessing the returns of the insurance and reinsurance market through investments in insurance-linked securities and reinsurance linked investment funds is growing all the time, as the popularity and awareness of the space increases.

It’s interesting to see the diverse mix, from pension funds which can be global corporate pensions, to small local authority pensions, to endowments, to private family offices, to sovereign wealth funds, to hedge funds, fixed income investors and also, it transpires, the investment manager of the Church of England.

CCLA Investment Management Ltd. provides investment and property fund management services to the Church of England, other faith based organisations, a number of local authorities in the UK and some charities.

It turns out that CCLA Investment Management appreciates the returns possible from allocating a portion of its assets into a reinsurance linked investment fund. In fact it allocates to a retrocessional reinsurance linked investment fund, namely the London Stock Exchange listed CATCo Reinsurance Opportunities Fund which is managed by Bermuda-based reinsurance and retro asset manager CATCo Investment Management.

A stock exchange announcement shows that CCLA has increased its holding in CATCo’s listed reinsurance linked fund to over 6% of the total fund. CCLA already held nearly 15m shares in the CATCo Reinsurance Opportunities Fund but increased that to nearly 19m this week when it bought 4m more.

That puts its stake in CATCo at 6.22% of the voting rights of the fund, which is roughly equivalent to $20.7m of holdings. The additional shares it purchased will have cost around $4.34m.

The stake that CCLA Investment Management has in CATCo’s listed fund is actually held in a number of the funds it operates, namely the CBF Church of England Investment Fund, the COIF Charities Investment Fund, the COIF Charities Ethical Investment Fund, the Lankelly Chase Equity and the The Land Trust Equity.

It’s yet another demonstration of the broad and diverse range of investors who appreciate the returns possible from ILS and reinsurance linked investment funds. CATCo’s strategy may stand it in good stead in the coming months to increase its assets under management as the retro market has been growing in popularity with cedents in recent months.

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