Swiss Re says Alternative Capital Partners supporting nat-cat growth trajectory

Global reinsurance company Swiss Re said today that its third-party capital markets focused Alternative Capital Partners (ACP) division is supporting its long-term growth trajectory in natural catastrophe risks.

Swiss Re’s Alternative Capital Partners (ACP) division encompasses the companies dedicated insurance-linked securities (ILS) fund management unit, its risk-sharing partnerships with investors through quota share reinsurance sidecar arrangements, and its activity in catastrophe bond structuring, bookrunning and secondary market trading.

Helping Swiss Re as it continues to plan for growth, Alternative Capital Partners (ACP) third-party capital is supporting its ambitions in catastrophe reinsurance underwriting in particular.

This morning the company revealed a 2025 target for generating Group net income of more than $4.4 billion, with a Property & Casualty Reinsurance combined ratio of less than 85%.

When it comes to managing catastrophe exposure and achieving an underwriting balance between retention and cession of nat cat risks, ACP and the third-party investor capital it provides has become an important lever for Swiss Re.

The company said that its third-party assets under management across its sidecars and dedicated ILS funds has now reached US $3.3 billion, a slight increase on the mid-year.

Swiss Re said this morning that the growth of its nat cat exposure has been supported by the establishment of its ACP division, which has brought in additional third-party capital investors.

While the growing catastrophe exposure has meant a higher budget for large nat cat losses this year, Swiss Re also noted lower relief from retrocession.

But, “Given the sustainable support from ACP, Swiss Re can continue its long-term growth trajectory in nat cat,” the company explained.

Leveraging third-party capital partnerships with institutional and sophisticated investors can be a real lever for growth in the reinsurance world, which Swiss Re is now benefiting from via ACP.