Integral ILS Ltd. has been launched as a new Bermuda based insurance-linked securities fund manager by industry execs Richard Lowther and Lixin Zeng, with ties to global insurance distributor and servicer AmWINS and reinsurance firm TransRe.
Integral ILS Ltd. is in the early stages of its development still, but targeting being ready to deploy capital by January 2021, the company confirmed to us.
Richard Lowther and Lixin Zeng are very well-known faces in the ILS market, which will give the Integral ILS venture platform-recognition among its peers and also investors.
A representative of the company confirmed with us that positions are now being hired for, with a number of well-known faces set to emerge at Integral ILS in time.
But perhaps the most interesting aspect of Integral ILS is the partner companies that are involved, with origination focused AmWINS and ILS and third-party capital experienced reinsurer TransRe, both of which we’re told will take stakes in the start-up ILS fund manager.
AmWINS has expertise and experience leveraging its direct risk origination and access to risk to shorten the market-chain and channel that business to sources of ILS capital already.
TransRe has a stake in ILS manager Pillar Capital, as well as its own TransRe Capital Partners division focused on third-party capital and with its own collateralised sidecar vehicle Pangaea. TransRe has also done some fronting for ILS capital, another useful trait of a partner.
The senior leadership at Integral ILS will be Richard Lowther, ex-Managing Principal of Hiscox ILS and Lixin Zeng, ex-CEO of AIG’s AlphaCat ILS unit.
Also coming onboard are Matthew Swann, Adriaan Van der Merwe and Emily Birrell, all of who are former Hiscox ILS employees.
Integral ILS Ltd. told us they have also hired a software developer, as well as an analyst and have a Bermuda based underwriter ready to join the growing team as well.
Lowther and Zeng had previously worked together at AlphaCat, with Lowther holding the role of COO there prior to his move to Hiscox.
The pair now find themselves at the helm of a compelling team-effort, in Integral ILS, that has the potential to bring new capital to ILS and reinsurance markets over time, helped by having more direct access to the all-important risk to match it with.
The relationships with AmWINS and TransRe will assist Integral ILS in gaining preferred access to sources of insurance and reinsurance business, as well perhaps as fronted access to the open market, thanks to TransRe’s emergent activities in that space, of fronting for ILS, as well.
We also understand that Integral ILS is likely to begin its operations underwriting using a special purpose insurer (SPI) named Integral Reinsurance Ltd. (Integral Re).
We’re told the target is to begin deploying capital and building a portfolio in time for the January 2021 renewals, but at this stage the focus is on capital raising
Integral ILS Ltd. aims to be an “investor focused” and independent ILS fund manager and is in discussions with a number of investors over potential anchor commitments, we’ve been told.
The company will look to create high-quality ILS portfolios, underwritten thanks to its comprehensive access to the entire insurance value-chain through its strategic alliances with risk origination partners AmWINS and TransRe.
The company also hopes to outperform by putting superior risk selection to work, leveraging scientific and analytical resources to ensure robust portfolios are created.
We were told by the company that catastrophe risk will be the focus and that it will write insurance, reinsurance and retrocession, but with everything fully-fronted to begin either via an AmWINS MGA participant carrier, or via TransRe.
The aim is to produce portfolios and an independent ILS management business with less execution risk, lower friction and frictional costs, and reduced risk of capital being trapped.
With experienced ILS executives Lowther and Zeng at the helm, Integral ILS will be an interesting start-up to watch in the space.
The challenge now will be in raising money for a new ILS start-up at a time when institutional investor capital remains much more difficult to tap, due to the global macro environment. Integral ILS is in discussions with a number of pensions and investors over potential anchor roles.
But the proposition will be compelling and Integral ILS is certain to peak the interest of investors looking to access the returns of ILS business, at this time when the market is firming.