A new insurance-linked securities (ILS) risk securitisation facilitator and risk transfer consultancy named Replexus Group has been launched by Cedric Edmonds, formerly at Swiss ILS manager Solidum Partners.
Edmonds left Solidum in recent months, returning to the United Kingdom to launch a new venture.
During his time at Solidum Partners, Edmonds had been responsible for the launch of a unique, insurance-linked securities (ILS) focused blockchain securities clearance and settlement platform, named ILSBlockchain.
The ILSBlockchain platform had been involved in a number of private catastrophe bond or ILS deals for Solidum Partners, securitising reinsurance or retrocessional risks and then settling them in a more cost-effective manner using blockchain technology.
Now, Edmonds has launched a new venture called Replexus, offering insurance and reinsurance risk securitisation services and facilitation, including through the use of the blockchain platform he created that has moved with him.
The range of services include everything from reinsurance and ILS deal structuring, right through to trustee, settlement and blockchain services, providing the full life-cycle for transforming collateralised reinsurance into insurance linked securities (ILS) that are settled and traded on an electronic platform.
Edmonds explained to us, “Replexus combines all services required to securitise reinsurance contracts, to place the resulting ILS, to settle them using a blockchain platform provided by BloxSys, a part of the Replexus group, which supports secondary trading, all in a single one-stop shop, turn-key operation.”
BloxSys is the blockchain platform element of Edmonds new offering, providing the electronic settlement platform for issuers using Replexus’ services.
Edmonds explained how Replexus can help insurance, reinsurance and ILS market participants, “Replexus gives cedents and traditional reinsurance brokers simplified access to the ILS market with a highly efficient and cost effective process. Existing structuring and placing agents can use Replexus merely for those areas they already outsource such as transformation, documentation, collateral management and securities settlement via the BloxSys blockchain technology.
“For ILS funds Replexus provides a way to assume collateralised reinsurance risk as a security on a trading platform with the potential of liquidity and without the need to manage their own transformation vehicles with all the inherent time and cost involved. It allows them to concentrate on risk assessment and portfolio management.
“Replexus supports UCITS funds’ participation in the collateralised reinsurance market by syndicating the resulting ILS. This means that UCITS funds can participate in collateralised reinsurance, accessing much-needed diversifying risks, whilst still respecting their single issue limits.
“The goal for Replexus is to help support the creation of a vibrant liquid market in collateralised reinsurance securities for all players in the market to participate in.”
Meanwhile, the electronic platform that features blockchain as its core technology, BloxSys, can also be tapped by existing issuers looking for efficient settlement services and trading.
“BloxSys, the company providing the blockchain technology for the settlement of ILS issued by Replexus issuers, is a part of the Replexus group. It is able to offer investors support in setting up their own node or it can provide a fully hosted node for investors. Finally Replexus is able to hold securities in trust for investors who do not wish to have their own node or to use a hosted node but wish to outsource the holding of securities on the blockchain entirely. Finally BloxSys offers consulting for blockchain and other solutions,” Edmonds said.
Finally and perhaps of immediate relevance, Edmonds is also offering consultancy around alternative risk transfer and non-traditional reinsurance solutions and he has a product idea and capacity to support it that could be extremely relevant at this time.
“Although not part of its core offering, Replexus is also an innovative provider of non-traditional reinsurance solutions. It is currently in the market with capacity for a structured reinsurance product which provides cover with a reinsurance recoverable for losses arising from the current COVID-19 pandemic,” Edmonds said.
That’s a unique offering at this time and for any companies fearing the potential exposure to pandemic risk that may sit in their portfolios, or risks posed by future Covid-19 waves, this could be a particularly useful offering.