New capital sources and risk dynamics create significant opportunities for growth: Oak Global CEO

As the insurance-linked securities (ILS) and reinsurance markets adapt to an evolving risk landscape spanning geopolitics, climate, and artificial intelligence (AI), new capital structures are emerging to meet growing demand, and Oak Global plans to leverage investor diversification to capture these opportunities, according to CEO and Founder, Cathal Carr.

Speaking to Artemis just before the 2026 Monte Carlo Rendez-vous event, Carr, discussed a range of topics, such as how the specialist Lloyd’s underwriting company plans to scale third-party capital, branch out further into the ILS industry, and any future plans it has for the catastrophe bond market.

To begin, Carr shared with Artemis what Oak Global’s long-term goals are for scaling third-party capital.

“Since the inception of the business, we’ve tried to design a hybrid capital model, where we feel it has the right balance and dynamism as we think about different forms of capital and bringing that to bear. So, within the capital stack, we have Bain Capital as our private equity investor. We also have capital that comes through from the members’ agents in terms of names capital,” Carr told Artemis.

“But in addition to that, we also engage with a number of other investors, and we increasingly expand the breadth of the investors that we’re bringing into that capital stack through long term agreements, and that could extend to traditional FAL investors, but actually more expanding to some of the newer financial investors that are coming into the industry,” Carr further explained.

He continued: “Do we expect that increasing diversification to occur over time? Yes, we do, and we also believe that helps us achieve two key components that we think about from a capital perspective. Number one, being a permanence in terms of that certainty around capital being there over time to deliver for our clients, but also scalability and the ability to, when the opportunity is available, to increase those offerings to clients.

“When we think about the industry and the broader risk environment at the moment, we see across key emerging areas of risk. Going through some of those, with geopolitical risk, we see the evolving dynamic within the Middle East, and obviously with Russia and Ukraine, and then when we think about economic risk, we have to consider the uncertainty that’s there around interest rates, inflation, and also trade disagreements globally.

“We can also move to weather and climate-related risk and the increasing contribution of losses that are coming from secondary perils and the dynamic that continues to be at play there, and then we also need to think about technology and the impact that AI will have around existing products in terms of some of the casualty products that may be impacted by AI, but also new products that are emerging as a result of AI too.”

Highlighting these distinct risk areas, Carr emphasised that it shows that there is a big challenge for the industry in terms of the evolving nature of those risks

“But we view those as a significant opportunity for our industry, where there is growing demand and there is a significant protection gap within those areas of risks that we as an industry can grow within,” the CEO said.

Furthermore, Carr also added how he views this landscape as a catalyst for expanding non-traditional capital deployment across the sector.

“We also have a very exciting dynamic around capital and our industry, where we see increasingly new forms of capital coming into our industry. Historically, obviously, we would have had a dynamic which was driven by public equity capital. We’ve seen a phase of that expand to include overtime hedge funds, pension funds, sovereign wealth, and then in the last couple of years, we’ve seen an increase in innovative structures being developed and different forms of capital, whether it’s private equity and more traditional asset managers, private credit, family office etc.”

Adding: “We feel that for our industry there’s a significant opportunity there for us to collectively grow the market, to bring more value to our investors, to create more value, but also importantly to increase our value add to societies, to businesses, to consumers, and that for us, as we think about that future as a business, that’s something that we’re particularly excited about.”

Attention then shifted towards the catastrophe bond market. With Oak Global successfully securing its debut Arthur Re Ltd. – Quercian Re 2026-1 issuance earlier this year, we asked Carr whether he envisions it becoming a programmatic feature of the company’s capital strategy going forward.

“Yes we do. As we evaluate the optimal management of both earnings volatility and capital protection across our two syndicates, we use a hybrid approach to leverage available mechanisms, bring capital to bear, and also add value for our clients.

“For example, we have purchased traditional ultimate net loss (UNL) retrocession products since the inception of our business. We will continue to do this while we build on our long-standing relationships with those partners. We also utilise index products, and purchase industry loss warranties (ILWs) to help manage risk.”

The CEO also emphasised how partnering with reinsurance broker Gallagher Re and utilising Arthur Re Ltd., the firm’s Bermuda-domiciled unrestricted special purpose insurer (SPI) and segregated accounts company, helped drive momentum for the transaction.

“Additionally, we are proud to have partnered with Gallagher Re on the first cat bond issuance through their Arthur Re structure. The cat bond provides us (Oak) with roughly $150 million in limit protecting against North American perils. From an innovation perspective, partnering with Gallagher Re on this structure helps reduce overall transaction fees, which as a result drives greater efficiency across the value chain,” Carr added.

“In terms of whether we expect this to remain a core part of our capital management strategy within the syndicate going forward, we certainly do. And we will continue to manage across these available mechanisms with a long-term mindset while engaging with different investors along the way,” he continued.

Oak Global managed to successfully upsize its Arthur Re Ltd. – Quercian Re 2026-1 issuance by 100%, from $75 million to $150 million, while also pricing the notes on offer below initial guidance which highlighted the effective reception the investor base gave towards the company’s inaugural cat bond offering.

“We were very delighted by the level of engagement we received from the investor community when we went to market with the cat bond. Going through that process for the first time as a business, there is always uncertainty regarding how it will be received and receiving that high level of engagement across a broad suite of ILS investors in the cat bond space allowed us to achieve terms that worked for both sides,” Carr noted.

“As mentioned, we were also able to upsize the issuance on the back of that strong interest, and that is something we are thrilled about. Looking at the long-term commitment and the term of the cat bond overall, we feel it adds real value to our business. It helps us deliver capital certainty for our clients over time while providing strong value to investors through a lasting relationship,” Carr concluded.

Read all of our interviews with ILS market and reinsurance sector professionals here.