Insurance Linked Investments

There is evidence from the third-quarter 2023 results of White Mountains that its re/insurer subsidiary Ark is starting to see increasingly significant benefits delivered by the $250 million Outrigger Re collateralized reinsurance sidecar that it launched at the end of 2022.

In what looks to be a positive sign for its third-party investors, the Mt. Logan Re collateralized sidecar vehicle has been accepting increased levels of reinsurance premiums in 2023, while losses ceded to it by parent Everest Group are down considerably.

According to RenaissanceRe’s CEO Kevin O’Donnell, with the acquisition of AIG’s reinsurance businesses under the Validus brand now complete, the insurer remains on-track to invest $500 million into two of the RenaissanceRe Capital Partners vehicles.

So far, global reinsurance firm Swiss Re, is not seeing a significant pick-up in inflows to alternative capital and insurance-linked securities (ILS) structures, but its CFO John Dacey said today that “slight growth” is possible.

Private ILS funds that allocate to collateralised reinsurance instruments other than catastrophe bonds, are now accelerating their 2023 returns over the group of pure cat bond funds in the Eurekahedge ILS Advisers Index after September’s results.

Nephila Capital is well-positioned heading into 2024, as having now resolved some legacy side pocket reserves, the catastrophe risk focused investment manager can focus on the market opportunity, according to Jeremy Noble, President of Insurance at Markel.

As we reported over a week ago, Vesttoo, the insurtech at the centre of an international reinsurance letter of credit (LOC) fraud investigation, is trying to sell off assets of the firm, to realise value it believes is inherent in the business.

Markel has reported that it recognised a $25 million credit loss against a fraudulent $50 million letter of credit (LOC) for reinsurance provided by insurtech Vesttoo, and suggested a chance that more could come with a second LOC also found fraudulent.

Enact Mortgage Insurance has returned to the insurance-linked securities (ILS) market for the first time in over two years, seeking just under $248 million of collateralized mortgage reinsurance protection from an issuance of Triangle Re 2023-1 Ltd. mortgage insurance-linked notes.

AXIS Capital, the Bermuda based specialty insurance and reinsurance company, ceded more premiums to third-party investors in the third-quarter of 2023, as its new Monarch Point Re casualty ILS vehicle started its build-out.