Arthur J. Gallagher (AJG) has taken ownership of another private catastrophe bond issuance platform and insurance-linked securities (ILS) transformer vehicle, with the previously Willis Towers Watson owned Resilience Re Ltd. passing across to the company as part of its recently completed acquisition of Willis Re’s treaty reinsurance operations.
Resilience Re Ltd. was launched in Bermuda by Willis Capital Markets & Advisory back in 2014. That unit subsequently became Willis Re Securities, which has now been acquired by AJG and becomes part of its reinsurance broking offering under Gallagher Re and we expect may be named Gallagher Re Securities in time.
The idea was to broaden out the firm’s offering to include a platform to simplify client access to catastrophe bond capacity.
Offering clients a more cost-effective way to access sources of ILS and collateralized reinsurance capital, with the end result being a cat bond like issuance of securitized, syndicated but privately placed notes, Resilience Re was designed to also make accessing the cat bond market for capacity quicker and simpler.
In part, this was to be achieved through simplified processes and documentation for qualifying risks, offering clients access to dedicated reinsurance transformers along with standardised reinsurance and securitization procedures.
Willis had some success with the Resilience Re platform, with the vehicle responsible for twelve of the private catastrophe bond issues that we’ve seen and recorded in our Artemis Deal Directory.
Those twelve issues that we sourced information on amounted to just over $1 billion of risk capital issued.
It’s likely Resilience Re had been more widely used than that, as we only list the transactions we are able to source sufficient information about.
For AJG and Gallagher Re, the Resilience Re private cat bond will add to the range of options available to its clients.
Of course, AJG already owns Horseshoe, via Artex Risk Solutions and Horseshoe has its own very successful reinsurance transformer and private cat bond or ILS issuance vehicle, Eclipse Re Ltd.
Having two such vehicles at its disposal is no bad thing, but it will be interesting to see whether Resilience Re ever sees the light of day again, given Eclipse Re has been far more prolific in recent years.
The last private cat bond from Resilience Re was issued in April 2019.
Where as, Eclipse Re has issued 10 transactions amounting to over $411 million of risk capital in 2021 alone.
Gallagher International Holdings (U.S) Inc. is now the direct shareholder in control of Resilience Re Ltd., with AJG an indirect 50% shareholder.