SCOR raises new third-party capital, grows capacity with existing risk partners

France-headquartered global reinsurance firm SCOR has said today that it raised new third-party capital from risk partners in January 2024, while it also expanded the capacity arrangements it has with existing risk partners by 20%.

SCOR leverages third-party investor capital within its retrocession arrangements and as a way to share in the risk and reward of its underwriting with partners.

The company had said last year that it had an ambition to further expand its insurance-linked securities (ILS) asset management activities, while seeking increased fee income from retrocession partnerships.

The company seems to have made further progress on those goals around the 1/1 2024 renewal season, which it reported on earlier today.

At the January 2024 renewals, SCOR reported that, “On retrocession, SCOR improves its protection with enhanced capacity and coverage expansion at constant cost.”

While also saying that, “SCOR continues the development of risk partnerships with new and existing partners.”

When it comes to the reinsurance firm’s catastrophe PML, SCOR said that “increased retrocession” was “placed at attractive conditions,” which helped the firm in “keeping an underweight net exposure.”

Retrocession is now more available, the company said, which has clearly benefited SCOR directly.

SCOR saw a “20% year-on-year capacity growth with existing risk partners,” the company reported today.

SCOR’s so-called Alternative Solutions division grew premiums by an impressive 192% to EUR 550 million in its renewals deployment, which is where some of the risk partnership business sits.

Perhaps more notable though, SCOR also highlighted that its work with risk partners around the renewals, including “expansion into non-Cat lines of business,” which likely explains part of the significant expansion in that Alternative Solutions line.

That’s notable as SCOR’s first venture into sharing non-cat underwriting business with risk partners, as it looks to more deeply embed third-party sources of capital and capacity into its business.

Finally, it seems SCOR also increased the amount of third-party capital it is working with at the January 2024 renewals.

The reinsurer said that “additional third-party capital” was raised in January and that this included arrangements “with new risk partners.”

With “risk-adequate” pricing expected across reinsurance in 2024 by SCOR, the third-party capital risk partners that have signed up to work with the reinsurer, or committed more capital, stand a good chance of profiting from the performance of its underwriting book, major catastrophes allowing.

As a reminder, SCOR also manages insurance-linked securities (ILS) funds at its asset manager arm, SCOR Investment Partners. The SCOR Investment Partners ILS AUM rose to around $3.9 billion for the start of 2024, as detailed in our Insurance-Linked Securities Investment Managers & Funds Directory.