HSCM sets up Bumblebee Re to bring reinsurance cell formation in-house

Hudson Structured Capital Management Ltd., which undertakes insurance and reinsurance investment business as HSCM Bermuda Management Company, has established special purpose insurer Bumblebee Re Ltd., as it looks to take the process of collateralized reinsurance cell formation in-house.

Bumblebee Re Ltd. has been registered in Bermuda as a Special Purpose Insurer to conduct ‘unrestricted special purpose business,’ pursuant to Section 4 of the Insurance Act 1978.

The aim is to bring collateralized reinsurance cell-formation business in-house for HSCM Bermuda, as it enters into transactions that require a cell structure, to protect and segregate assets and liabilities between transactions underwritten.

Typically, these are often rented from service providers, but by establishing its own SPI to enter into collateralised reinsurance agreements, Hudson Structured is reducing its reliance on any third-party and giving itself more control over the arrangements for cell formation.

Edouard von Herberstein, Partner and Chief Underwriting Officer at HSCM Bermuda will serve as Chief Executive Officer of Bumblebee Re Ltd.

“Over the past four years, HSCM Bermuda has transformed over 90 reinsurance contracts across all lines of business into investable securities,” von Herberstein explained. “We believe Bumblebee will be a catalyst for us as we continue to improve processes internally and elevate our level of service to our investors and cedants alike.”

Michael Millette, Managing Partner of HSCM Bermuda, also serves on the Board of Directors of Bumblebee Re and will advise the entity on business development as well.

“We are excited to launch this new platform under Edouard’s leadership and are confident that it will facilitate crisp and efficient execution of our collateralized reinsurance activities,” Millette said.

Bumblebee Re Ltd. will commence operations immediately for HSCM Bermuda, acting as a segregated cell structure transformer to enable the group to collateralize insurance and reinsurance risks underwritten and flow their returns to the investment funds under its management.

We published a video interview with Hudson Structured Founder & Managing Partner Michael Millette last week.