Global provider of specialty insurance and reinsurance products and third-party reinsurance capital management firm Lancashire Holdings looks set to launch another sidecar under the successful Accordion Re branding. The first Accordion Re sidecar was so named as it was said to be designed to shrink or expand with Lancashire’s needs, investor for catastrophe risk and reinsurance market conditions.
Lancashire registered a special purpose insurer in Bermuda on the 14th March of this year called Accordion Reinsurance II Limited, according to the Bermuda Monetary Authorities company registration statistics, so we can assume that a new sidecar launch from the firm is likely imminent.
Lancashire Holdings recently launched a new brand for its third-party reinsurance capital management activities, Lancashire Capital Management, with which it aims to create a platform it can expand from to leverage new opportunities to attract and utilise third-party capital within its underwriting.
If an Accordion Re II sidecar is launched soon it will no doubt be designed to take advantage of reinsurance opportunities at the mid-year June and July reinsurance renewals. A new sidecar launch would also assume that Lancashire has already, or is close to securing, new inflows of third-party investor capital and Accordion Re II could be the first vehicle it launches to put new capital inflows to work.
We should also note here that it is also possible that Accordion Re II could just be a new vehicle which Lancashire could choose to roll the capital from Accordion Re into, although a new sidecar with new capital is, we feel, more likely given how receptive investors are to new opportunities to deploy capital into catastrophe risk right now.
Lancashire recently appointed Darren Redhead, previously of hedge fund reinsurer D.E. Shaw Re, as Head of its new Lancashire Capital Management division and when or if an Accordion Re II sidecar is launched it will be the first launch under the new brand and under Redhead’s supervision.