Nephila Capital, the largest investment manager of insurance and reinsurance linked securities (ILS) and weather risk assets, is working with financial technology software and service provider Phinsys on the launch of its Lloyd’s managing agency.
Nephila, through its recently approved and soon to launch independent Lloyd’s managing agency Nephila Syndicate Management Ltd., selected Phinsys’ suite of insurance sector focused finance and accounting products to assist it in improving and managing the necessary processes that come with running its own operation in the Lloyd’s of London insurance and reinsurance market.
Phinsys’ suite of software technologies will be used to help Nephila streamline the financial processes of its Lloyd’s managing agency, as well as to automate statutory, regulatory and management reporting.
Nephila’s Syndicate 2357 is expected to transition over to management by Nephila Syndicate Management Ltd. in October, meaning that it needed to have its processes in place and ready to go.
Lloyd’s is of course on a push to increase the efficiency of the marketplace, to make it more competitive, aiming for as much as a 50% reduction in the expense ratio over the next five years.
Cognisant of this, Nephila has prioritised the automation of its back-office processes, with Phinsys assisting as the ILS manager sets out a strategy to support future growth in the Lloyd’s market.
Adam Beatty, CEO of Nephila Syndicate Management Ltd., commented, “Reducing the cost of doing business at Lloyd’s was a key driver in choosing Phinsys as our finance technology partner. By streamlining our finance back office operations we can minimise our expense ratio and accelerate our regulatory reporting.”
Richard Tyler, CEO of Phinsys, added, “Nephila’s migration from third party management demanded a new approach to their finance, accounting and actuarial functions. By implementing the Phinsys platform of software tools, Nephila has achieved greater control over their financial data, gained valuable insights into how they are performing as a business, and significantly reduced costs to support their operating model and increase profits.”
Phinsys’ software allows insurance and reinsurance market players, and ILS fund managers such as Nephila, to consolidate data from numerous legacy systems into a single, scalable finance data warehouse.
It allows for automatic reconciliation and post accounting entries to be made to their general ledger, while the accuracy and transparency of other accounting processes, such as expense allocation, IBNR calculation, results planning and forecasting, are also improved.
In addition, the solution will help Nephila’s managing agency operations through the delivery of automated regulatory and management reports, helping them to better understand where to invest time and money.
Nephila Capital has spent its entire history working to make the risk capital it deploys as efficient as possible, so now it enters the oldest insurance and reinsurance market it is natural for the ILS manager to look to technology solutions to drive the efficiency of its offering in Lloyd’s as well.