Marrikel, the company that launched in mid-2020 with a product offering of a full reinsurance broking platform, has rebranded itself as Re Square and pivoted to offer just reinsurance auction technology, as an option alongside its full platform, recognising many brokers want to retain control of their own transaction flows.
The move puts Re Square firmly up against other tech companies offering programmatic, optimised reinsurance and risk transfer auction technology, such as Tremor Technologies which has built its own proprietary technology focused solely on the reinsurance industry and signed agreements with brokers who will use it.
Re Square has partnered with The Numerical Algorithms Group (NAG), a tech-firm focused on numerical algorithms and high-performance computing (HPC), to deliver this auction technology to its clients.
The idea is that, instead of having to license Re Square’s entire broker platform, which remains available, reinsurance brokers could just offer auction technology using this technology solution developed with NAG.
The company, which was launched by Frederik Eloff and James Karim, who previously worked together at a Deutsche Bank start-up ILS fund management unit, hopes to gain uptake from brokers that are more protective of their entire placing flows, but do not have the capability to develop their own auction technology.
James Karim, Founding Partner of Re Square, commented, “We are committed to improving the adoption of technology in the reinsurance market. While licensing is the right solution for many participants, we recognise that some brokers wish to retain full ownership of their placement infrastructure. We look forward to providing them with the complex auction capabilities clients increasingly desire.” Frederik Eloff, Founding Partner, added “We are delighted to partner with a company of NAG’s distinction and to bring their expertise to our marketplace.”
“NAG enjoys a unique position in the world of numerical computing, mathematical optimization, HPC and financial services” added NAG CEO Adrian Tate. “We have seen broadened use of mathematical optimization across financial services and there appears to be great potential in expanding the use of algorithmic allocation techniques in the reinsurance market. We are excited to partner with Re Square, whose combination of industry knowledge and mathematical modelling is compelling.”
Re Square’s move is another sign of just how important that last-mile of the reinsurance and risk transfer broking, placement and syndication process is.
It also reflects the opportunity to improve this piece of brokers work-flows.
The optimisation of the matching of risk and capital is the piece that technology can really solve to add efficient to all parties, as there are benefits in this for cedents, markets and brokers alike.
Enabling brokers to offer a more high-tech risk syndication, matching and placement solution through auction technology is gaining traction, with Tremor so far the leading proponent of this.
Re Square wants to get in on the action.
Applying financial market auction technology to reinsurance can deliver significant benefits to the market and help make its capital more efficient.
However, it’s vital that auction solutions are built with reinsurance and risk transfer in-mind, rather than just repurposing auction tech used in broader financial trading markets.
Reinsurance has many unique features and it’s critical that trading and marketplace platforms take into account the preferences of reinsurance cedents and markets, to enable trading to be as effective as possible and to gain cedent and market adoption.