Nephila Capital news

Nephila Capital, the insurance and reinsurance linked investment manager owned by Markel Group, has won a mandate from the Florida State Board of Administration during the first-quarter, to deploy $300 million into reinsurance through Arachne, a Bermuda based ILS structure, Artemis has learned.

Revenues earned through the Nephila Capital insurance-linked securities (ILS) investment management business by owner Markel almost doubled in the first-quarter of 2024, while Nephila Capital’s assets under management (AUM) were stable for the period.

2023 saw strong growth for insurance and reinsurance linked investment manager Nephila Capital’s specialty lines focused Syndicate 2358 at Lloyd’s, which more than doubled both its gross written premium and its profit for the year.

Syndicate 2357 at Lloyd’s, which is the flagship syndicate operated by Nephila Capital, a leading dedicated investment manager in the insurance-linked securities (ILS), weather and catastrophe reinsurance space, has reported a 65% increase in profits for 2023, as its combined ratio came in at a very low 25.5% for the year.

The original thesis for buying into the insurance-linked securities (ILS) sector with the acquisition of Nephila Capital is now starting to be confirmed for Markel, as the ILS managers’ results improved dramatically and its funds are substantially all above their high-water marks after 2023.

Nephila Capital had a “fantastic” year in 2023, according to Jeremy Noble, President of Insurance at Markel, who said that the insurance-linked securities (ILS) unit “demonstrated itself as a market leader” and is well-positioned going forwards.

In reporting its full-year 2023 results, Markel Group has highlighted higher insurance-linked securities (ILS) revenues from the managed ILS funds of its Nephila Capital unit, while program premiums ceded to Nephila reinsurance structures have soared.

Nephila Capital, the insurance-linked securities (ILS) asset manager owned by Markel, has effectively cleaned up its legacy reserves and eliminated trapped capital for its investors, through an arrangement entered into with the help of an adverse development cover (ADC) from its parent.

Nephila Capital is well-positioned heading into 2024, as having now resolved some legacy side pocket reserves, the catastrophe risk focused investment manager can focus on the market opportunity, according to Jeremy Noble, President of Insurance at Markel.

In the last quarter of record, Nephila Capital unlocked some side pocketed capital and this caused an increase in insurance-linked securities (ILS) revenues reported by parent Markel, while premiums ceded to Nephila’s reinsurers are on the rise, even as assets under management declined further.