White Mountains renewed collateralized reinsurer to support MGA Bamboo, but at reduced size

During the second-quarter of this year, White Mountains renewed its investment commitment to a collateralized reinsurance structure that provides sidecar-like support to managing general agent (MGA) Bamboo, but the size of the commitment has decreased as Bamboo now has growing third-party reinsurance support.

In 2024, White Mountains made its first committed of capital to the Bermuda-based collateralized reinsurance structure, providing $30 million of reinsurance capital to support its fast-growing California homeowners managing general agent (MGA) Bamboo.

The investment commitment has been renewed in the second-quarter of 2025, we now understand, but White Mountains only committed $10 million of capital to the collateralized reinsurance structure for the next annual risk period.

The reason for the decline in capital commitment for the 2025 reinsurance treaty year is that Bamboo has been building-out its reinsurance arrangements over the past year and its program experienced strong demand from third-parties at the mid-year renewals, meaning White Mountains did not need to provide as much support, it seems.

As a full-service, capital light MGA, it’s no surprise that Bamboo’s expanded reinsurance includes more third-party capital.

Just this year, the Greengrove Re Ltd. (Series 2025-1) catastrophe bond sponsored by Sutton National provided more third-party capitalised reinsurance for business produced by Bamboo.

Sutton National Group also sponsored its first collateralized reinsurance sidecar issuance, a $70 million Greenshoots Re Ltd., which also provides core catastrophe cover for business written by Bamboo.

With other investors showing appetite to support business underwritten and produced by Bamboo, it seems that Bamboo’s backer White Mountains no longer needed to deliver as much support this year.

In 2025, White Mountains received a $17 million distribution from the Bamboo collateralized reinsurance vehicle.

The structure incurred losses and loss adjustment expenses of $18.8 million through the first nine months of 2025, unsurprisingly a lot higher than the $8.1 million reported for the first nine months of 2024, with this increase driven by the California wildfires in January 2025 as they drove $12 million of losses and LAE.

The collateralized reinsurance arrangement generated $2 million of pre-tax net income in Q3 2025, but a -$6 million pre-tax loss for the first nine months, again due to wildfire effects given Bamboo’s California focus.

Since the collateralized reinsurance arrangements inception, it has now generated $3 million of pre-tax income, $2 million being from the 2025 treaty year so far.

For Bamboo, this collateralized structure acts like a quota share reinsurance sidecar, capitalised by the support of its major share holder White Mountains.

Even given the effects of the California wildfires, it appears to have been a profitable arrangement for both sides, helping Bamboo manage its catastrophe losses, while generating some income for White Mountains.