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RAC Pension Scheme in $900m longevity swap to SCOR

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The RAC (2003) Pension Scheme has entered into a longevity swap transaction which sees $900 million (£600m) of its longevity exposure transferred to French reinsurance firm SCOR SE, removing one-quarter of the pension schemes longevity risk.

Hymans Robertson acted as lead advisor to the trustee of the RAC (2003) Pension Scheme and hails the transaction as the “first longevity swap to bring the benefits of avoiding intermediary costs to smaller scale transactions.”

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No one better to manage world’s risks than re/insurers: UN’s Figueres

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There is “no one better able to help the world manage its risks” than the insurance and reinsurance industry (and we would venture the ILS market), according to Christiana Figueres, Executive Secretary of the United Nations Framework Convention on Climate Change.

Speaking during an event held by the French Federation of Insurance Companies (FFSA) in Paris this morning and coinciding with the build up to the key COP21 climate talks next week, Figueres explained the important role that insurance and reinsurance plays in helping the world to manage, mitigate and adapt to the risks posed by climate, weather and natural disasters.

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ILS to encompass a broader range of structures and assets: Experts

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The global trend for growth of reinsurance and insurance-linked securities (ILS) is set to continue and intensify, as investors increasingly look to sit on both sides of the fence, leading experts to predict that new structures and new asset classes are on the ILS horizon.

This is according to industry executives and analyst at the recent ILS Bermuda Convergence Conference 2015, on a panel discussion titled, ‘Converging Capital Structures,’ where they debated what the ILS market might look like five years down the line.

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More companies should adopt a hybrid reinsurance model: McConachie

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Market conditions see reinsurance firms struggle to generate desirable returns on the underwriting side of their balance sheets, leading Neil McConachie of Fidelis to ask why they aren’t writing less business and instead shifting capital to try to make a return on the investment side.

“There’s always been two ways to earn money as an insurance company, on the underwriting, which everyone is aware of, but I think people forget that actually most of the profits generated in the industry over the last 25 years have been from the asset side,” said McConachie, Chief Financial Officer (CFO) of Fidelis Insurance Holdings.

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Lloyd’s to pool $400m catastrophe capacity for developing economies

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Eight Lloyd’s of London syndicates are teaming up to provide their specialist underwriting skills and $400 million of natural catastrophe insurance and reinsurance capacity to help developing economies build resilience to disaster, climate or weather risks.

The eight Lloyd’s syndicates aim to develop new solutions to combat underinsurance, help to fill the protection gap and increase the resilience of the developing world to the threat of natural catastrophes and severe weather events.

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Approval of Bermuda’s equivalency under Solvency II celebrated

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Insurance associations from the European Union, the UK and Bermuda have praised the European Commission’s action to find Bermuda and the Bermuda Monetary Authority (BMA) as fully equivalent for all regulatory purposes under the European Union’s Solvency II regulatory and supervisory system for insurers which takes effect on 1 Jan, 2016.

Bermuda and Switzerland are the only two jurisdictions to date that have been recognised as fully equivalent under the EU initiative.  The Bermuda equivalency delegated act now stands for a 90-day consultation period with the European Council and the European Parliament.

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Alternative capital can help re/insurers better serve society: Loh

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In order to better serve the needs of societies in emerging markets insurers and reinsurers require the structures and capacity of alternative reinsurance and ILS, according to the Deputy Managing Director of the Monetary Authority of Singapore (MAS), Jacqueline Loh.

At the 13th Singapore International Reinsurance Conference held in early November 2015, speakers discussed the challenges and opportunities for insurers, reinsurers, and insurance-linked securities (ILS) players in the emerging, underserved Asia-Pacific.

During her keynote speech at the event, Jacqueline Loh highlighted the very real, and vast opportunity to increase insurance and reinsurance penetration levels across the region, and strengthen disaster resilience through the increased use of alternative sources of reinsurance capital.

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Global losses hint at broadening ILS fund specialism & exposure

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Recent loss events around the world have highlighted the fact that as ILS funds and managers increasingly deploy capital through collateralised reinsurance and private deals, they are becoming more specialist and diversified but also more exposed to a range of loss events.

This is ultimately a positive for the insurance-linked securities (ILS) and alternative reinsurance capital space, and its investors, as the additional choice, diversification and range of risks or perils covered can enhance returns and provide greater options to the investor base.

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More ILS capacity to enter market than exit post-event: Industry leaders

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As the use of ILS capacity has grown within the overall insurance and reinsurance market, the industry has voiced concerns about how investors will react after a significant loss event, but industry leaders actually predict more ILS capital to enter than exit post-event.

During the 2015 ILS Bermuda Convergence conference, a panel on ‘converging capital structures’ shared opinions on the permanence, stability and willingness of insurance-linked securities (ILS) investors to participate in the global insurance and reinsurance market after a significant loss.

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Barbican to manage Credit Suisse ILS team’s Arcus Syndicate 1856

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Barbican Managing Agency Limited, part of Barbican Insurance Group, has now received full approval from the Lloyd’s Franchise Board to manage Arcus Syndicate 1856 (Arcus 1856), the £90 million Lloyd’s Syndicate launched by the Credit Suisse ILS team recently.

As we wrote in September, Arcus 1856 will be fully capitalised by the Credit Suisse ILS investment management team with £90m of capacity, sourced from their third-party investors to be put to work in the Lloyd’s insurance and reinsurance market.

Arcus 1856 is the second full Lloyd’s syndicate to be directly capitalised by an insurance or reinsurance linked investment manager, following Syndicate 2357 which is capitalised by funds under ILS specialist Nephila Capital’s management.