Knipe’s Kilter Finance invests $40m in medical liability insurer

Kilter Finance, the insurance-focused specialty financing company launched by ex-Leadenhall Capital alumni Dan Knipe with backing from private equity giant KKR, is investing $40 million into medical liability focused insurance holding company Best Practices Medical Partners (BPMP).

Knipe, formerly the Deputy Chief Investment Officer at specialist insurance-linked securities (ILS) manager Leadenhall Capital Partners LLP, managing life and mortality linked insurance-linked investment strategies for the company, launched his new venture Kilter Finance in April 2020.

Kilter Finance benefits from a binding agreement with KKR for an investment of up to $500 million of equity funding, which it intends to put to work investing in insurance-linked opportunities, predominantly across the life, annuity and health insurance sectors.

In early 2021, Kilter Finance invested $89 million into Independent Insurance Group LLC, the parent of life insurer Independent Life, which was the first transaction we had seen from Knipe’s company.

Today’s news is the second investment we’ve seen from Kilter and the announcement came via BMS Capital Advisory, the investment banking focused unit of independent insurance and reinsurance broking group BMS Re.

Kilter Finance is making a US $40 million investment into Best Practices Medical Partners (BPMP), the holding company to Applied Medico-Legal Solutions Risk Retention Group (AMS RRG) and subsidiaries.

The investment is designed to support AMS RRG’s underwriting growth and the execution of its ongoing strategic initiatives.

The proceeds are expected to be used by BPMP to increase the statutory surplus of AMS RRG, as well as to accelerate its growth in medical professional liability insurance business, while also executing on other critical strategic initiatives.

BMS Capital Advisory acted as the exclusive advisor to BPMP on the financing, which saw it collaborating with BMS Re’s Legacy Practice and Ratings Advisory Unit.

Richard Welch, CEO of BPMP, commented “Led by BMS Capital Advisory and with the collective institutional knowledge and market experience possessed by BMS Group professionals, we were successful in attracting investment from an excellent source of capital in Kilter Finance. Leveraging 20 years of proven leadership in the professional liability market, our company has partnered with a specialist in the insurance and asset management sectors, and we look forward to continue our mission of providing high value medical liability insurance and enterprise risk management solutions to our current and future members.

“We are excited about the investment from Kilter Finance, who have demonstrated their insurance expertise and speed of execution through this process, and believe Kilter Finance’s insights and flexibility make them a perfect partner for us as we continue to grow.”

Dan Knipe, Chief Investment Officer of Kilter Finance, added, “We are delighted to be partnering with the BPMP management team for an exciting stage in their corporate development. We are deeply impressed by the group’s success and the quality of their existing financial partners, some of whom have supported the business for well over a decade.”

Romulo Braga, CEO of BMS Capital Advisory, also said, “BMS, as a whole, remains purposefully committed to identifying and delivering capital and risk management solutions in an effective, efficient, and agnostic manner. As such, we are very pleased to have facilitated this successful transaction, which is validation of BPMP’s market-leading executive team, insurance and distribution operations.”

Charles Lens, Managing Director of Kilter Finance, also commented, “We have carefully structured our investment to provide the company with the flexibility it needs to grow, while satisfying the requirements of all of its key stakeholders, in particular its regulator, the ratings agencies and its management team.”