News and articles about collateralized reinsurance transactions and collateralised reinsurance market trends.
Collateralised reinsurance simply refers to any fully-collateralised reinsurance transaction, be that securitised or not.
Collateralized reinsurance allows ILS funds, hedge funds, pension funds and unrated, third-party capitalised reinsurance vehicles to participate in major reinsurance programs as the contracts they write are fully-collateralised.
The collateral is put up by investors or third-party capital providers to cover in full the potential claims that could arise from the reinsurance contract.
Normally the collateral posted is equal to the full reinsurance contract limit, minus the net premiums charged for the protection.
Registrations of new insurance and reinsurance vehicles in Bermuda in December 2014 demonstrated a continued focus on ILS and collateralized reinsurance vehicles on the island and brought some more recognisable sidecar names to market.
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Global re/insurance firm Aspen felt the competition in reinsurance during 2014, forcing it to remain disciplined and non-renew some business at 1/1, but it expects to expand on its Aspen Capital Markets offerings and leverage its access to third-party capital in 2015.
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We jumped the gun slightly on Mt. Logan Re yesterday, saying it had reached $500m at the end of December 2014, as the firm said that additional capital of $270m was raised for the January renewal, taking Everest Re’s collateralized reinsurance sidecar closer to $810m in size, we believe.
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Bermuda headquartered insurance and reinsurance group AXIS Capital Holdings expects to expand the capabilities of its third-party reinsurance capital management unit, AXIS Ventures Re, in 2015 as it aims to create an increasing role for investors in its business.
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Bermuda based reinsurer PartnerRe has returned a larger amount of capital to investors in its fully-collateralized reinsurance sidecar vehicle Lorenz Re in 2014 than the firm did in 2013, according to its latest results.
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Bermuda-based reinsurance firm Everest Re has continued to gradually increase the size of its third-party capital backed, fully-collateralized reinsurance sidecar Mt. Logan Re Ltd., meaning the vehicle is growing its contribution to results.
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With insurance-linked securities (ILS) and capital market participation in reinsurance expected to continue growing strongly the outlook for traditional reinsurers remains bleak, analysts at investment bank Credit Suisse explained in a research note today.
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It may come as a bit of a surprise, but some reinsurance companies aren’t pulling back on underwriting U.S. catastrophe reinsurance business, as the margins available continue to be attractive to firms for which the hurdle rate is sufficient to meet cost-of-capital.
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The ninth in this series of articles involving leading figures from the insurance-linked securities (ILS) and reinsurance arena on the prospects for the market in 2015 features Kevin Lee from Moody’s Investors Service.
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Mt. Logan Re Ltd., the collateralized reinsurance sidecar operations of Bermuda-based global reinsurance firm Everest Re, has appointed experience reinsurance professional Dave Brining as Non-Executive Independent Director.
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