RenaissanceRe’s ILS and managed capital assets hit $3.6 billion

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Bermudian reinsurance firm and third-party capital manager RenaissanceRe has grown its insurance-linked securities (ILS) and managed capital assets to an impressive $3.6 billion, thanks to growth in some of its ILS fund strategies and the launch of the new Langhorne Re venture.

Of the near $3.6 billion of total assets managed within reinsurer RenaissanceRe’s Ventures unit, specifically by the RenaissanceRe Underwriting Mangers, Ltd. and RenaissanceRe Fund Management Ltd. entities, almost $2.2 billion is from third-party investors, largely institutional in nature, as of February 1st 2018, we understand.

ILS funds increasingly looking for reinsurer alliance : A.M. Best’s Modu

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Emmanuel Modu, Managing Director and Global Head of insurance-linked securities (ILS) at A.M. Best, has noticed ILS funds increasingly seeking more alliance with traditional reinsurers, driven partly by a push for efficiency.

Speaking with A.M. BestTV at the 2018 Artemis ILS NYC conference, held recently in Manhattan, Modu highlighted the search for alliance as a notable activity within the ILS space.

“What we’ve noticed is that ILS funds are now seeking actually more alliance with the reinsurers. In fact, they are seeking alliance through fronting arrangements, and in some cases actually starting their own insurance carrier, or helping facilitate their start-up carriers,” said Modu.

NAFI (National Agency of Financial Investigations) in Russia: Russians’ attitude to insurance had deteriorated

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During 2017 Russians’ attitude towards insurance had deteriorated: share of positive estimations decreased to 57% (vs. 65% in 2016) while share of negative estimations increased up to 32% (21% in 2016), according to the NAFI’s investigation report prepared in September 2017.

Insurance is more appreciated by respondents of the central region (73%). From the point of age, the older respondents were, the more negative attitude they had (70% positive respondents of age 18-24 against 45% positive respondents of age 55+).

Rosh Capital preparing for investment-oriented reinsurer launch

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Rosh Capital Management, LP is exploring the viability of launching a total return reinsurance platform to be based in Bermuda. The approach will be to integrate a multi-manager asset strategy with both prospective and retrospective underwriting solutions, to meet demand within the current underwriting environment.

The investment-oriented approach to reinsurance, sometimes termed total-return or hedge fund strategy, sees what is usually an alternative asset manager or hedge fund looking to enter reinsurance in order to access the premium float to inject into its asset management strategies.

There have been a number of attempts at making this strategy successful, but often it involved a less profitable reinsurance underwriting side of the business being supported by a volatile investment side, leading to wild swings in performance.

Parametric Pacific facility pays out $3.5m to Tonga for Cyclone Gita

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The Pacific Catastrophe Risk Insurance Company (PCRIC), a parametric catastrophe insurance facility for the Pacific Islands which is supported by the World Bank and others, has made its largest ever payout of $3.5 million to Tonga after the impact of Cyclone Gita.

The Pacific Catastrophe Risk Insurance Company (PCRIC) is a parametric disaster and catastrophe insurance captive insurer for the Pacific Island Countries, managing a $45 million pool of disaster risk that is backed by reinsurance.

The PCRIC provides its member countries with a mechanism to secure insurance coverage against tropical cyclones, earthquakes and tsunamis, all structured on a parametric trigger basis and with backing from the global reinsurance markets.

ILW’s can pave way as repeatable structures to fuel ILS growth: PCS

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The use of an industry loss warranty (ILW) structure in inherently complex and rapidly advancing risks, such as cyber and terror, could support the repeatability of other structures and ultimately assist the innovative efforts of the insurance-linked securities (ILS) market, according to Property Claim Services (PCS), a Verisk Analytics business.

In phase two of its ‘Reinsurance Manifesto,’ PCS follows up on the need for industry collaboration to expand the remit of the ILS market, with a call for the development of repeatable structures.

The reinsurance and ILS market has been innovative over the years, developing bespoke structures and solutions to meet demands.

World Bank looking to “push the boundaries” of ILS capital: Michael Bennett

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The establishment of the World Bank’s capital-at-risk notes program almost four years ago set the foundation for continued innovation and expansion, as the organisation looks to “push the boundaries” of insurance-linked securities (ILS) market risks, according to Michael Bennett, Head of Derivatives & Structured Finance, World Bank Treasury.

Speaking with Artemis following the completion of the historic $1.36 billion of parametric earthquake catastrophe bonds that benefit Pacific Alliance member countries Chile, Colombia, Mexico and Peru, Bennett highlighted the importance of the World Bank’s capital-at-risk notes program.

Bermuda regulator looks for greater clarity on ILS underwriting

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The Bermuda Monetary Authority (BMA), the financial regulator on the island, is requesting a more granular level of detail on activities involving alternative reinsurance capital and insurance-linked securities (ILS) underwriting, seeking detail on any re/insurance business financed by directly capitalised mechanisms.

The BMA has published what it calls its “Alternative Capital Schedule” which will be applicable to all re/insurers operating alternative capital vehicles or structures.

Nuclear liability risk ILS transactions upsized for 2018

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Private nuclear liability risk insurance-linked securities (ILS) transactions have been expanded and upsized for 2018, Artemis understands, as corporate nuclear power operators show increasing comfort with tapping ILS markets for direct insurance coverage.

These nuclear liability ILS deals were seen as ground-breaking, when details first emerged last year.

These transactions are relatively unique in the insurance-linked securities (ILS) space, not only due to the risks they feature (nuclear liability exposures) but because they have been directly transacted between a nuclear corporate and an institutional ILS investor, so are insurance rather than reinsurance arrangements.

ILS growth to persist as investors show optimism: Dubinsky, WTWS

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Insurance-linked securities (ILS) investors responded to 2017 catastrophe events with growth and optimism and further expansion is expected throughout 2018, with InsurTech offering some potential, according to Bill Dubinsky, Managing Director and head of ILS at Willis Towers Watson Securities (WTWS).

Speaking with A.M. BestTV at the 2018 Artemis ILS NYC conference, held in early February in Manhattan, Dubinsky noted that WTWS, a division of insurance and reinsurance broker Willis Towers Watson, estimates there is $88 billion of alternative, or third-party reinsurance capital at year-end 2017, up from $75 billion a year earlier.