Everest Re raises capital for Mt. Logan Re sidecar, takes AuM to $900m

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Everest Re, the global insurance and reinsurance underwriter, has raised new capital for its Mt. Logan Re Ltd. collateralized reinsurance sidecar-like vehicle towards the end of 2020, as the structure reached $900 million of assets under management at January 1st.

Mt Logan ReMt. Logan Re had started 2020 with assets under management of around $818 million, as it continued to deal with the effects of multiple years where major catastrophe losses had impacted it and similar reinsurance sidecar strategies.

Mt. Logan Re’s collateralized reinsurance assets under management then shrank somewhat through the middle of last year, falling to just over $800 million as of the middle of 2020.

Executives from Everest Re had said at the time that this actually represented some fresh capital raising at the time, with some growth seen in Q2 last year to help lift it back to the $800 million mark.

But now, we understand that Everest Re has had more success in raising capital for its Mt. Logan Re vehicle through the end of the year, as investors sought to be ready for the all-important January renewal season.

As a result, Mt. Logan Re had assets under management of $900 million as of January 1st 2021, which remains down on the peak size of the collateralized reinsurance structure, but signifies a strong return to asset growth.

Mt. Logan Re Ltd., a Class 3 Bermuda insurance structure, manages segregated accounts that provide collateralized capacity to the worldwide property catastrophe reinsurance market.

As such it’s not a pure sidecar, given its prime mandate isn’t taking a dedicated quota share of Everest Re’s own business.

Rather, Mt. Logan Re is market facing and operates alongside Everest, or on its own, providing its collateralized reinsurance capacity to peak peril catastrophe exposures.

As a result, it offers insurance-linked securities (ILS) investors a way to access returns driven by the quality of Everest Re’s origination, underwriting and relationships, through dedicated strategies focused on risk and return hurdles.

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