News review | June 11 2018

Investors in the Lottoland sponsored lottery jackpot insurance-linked securities and collateralised reinsurance are set to be on the hook for some level of payout after a €90m win by a customer triggered payouts through the firms unique Fortuna PCC insurance model. Lottoland renewed its Fortuna collateralised reinsurance transaction at an upsized €120m last year, making it the largest such reinsurance deal in gaming industry history.

Swiss Re has increased the amount of retro that it buys from its Sector Re sidecar, Bloomberg data shows. The reinsurer has raised $530.5m of Sector Re debt since December 2017, ahead of the $492m raised last year. The increase means the sidecar may have overtaken the size of Pangaea Re vehicles run by TransRe. TransRe raised $500m for its sidecar vehicles in 2017.
Trading Risk

A new Bermuda-domiciled special purpose insurer has entered into a quota share agreement with Fidelis Insurance Holdings Limited. Announcing the launch of Socium Re Limited, Fidelis said the ILS sidecar will provide collateralised capacity support for its reinsurance portfolio. Socium, which has secured capital commitments of approximately $50m, will reinsure a share of Fidelis’s worldwide excess of loss portfolio under the quota share agreement.

Florida property casualty insurer HCI has completed its reinsurance renewal, reducing the amount of risk it retains. The 2018-2019 reinsurance program provides coverage up to $888m for catastrophic losses in a single event, excluding flood losses. According to Paresh Patel, HCI’s chief executive officer, "Considering our first event retention is only $16m, we believe our company and our policyholders will remain well protected in the event of a catastrophe."
HCI Group

XL Group shareholders have approved an agreement for French insurance giant AXA to acquire 100% of the Bermuda-based reinsurer. In a statement, the group noted that its specialty platform would complement and diversify "AXA’s existing commercial lines insurance portfolio, and reinsurance capabilities that will allow AXA an access to enhanced diversification and alternative capital".
XL Group

GC Securities has commented on the significance of the placement of SCOR's Atlas Capital UK 2018 catastrophe bond, which was the first issued under new UK risk transformation legislation. "This pioneering transaction had strong investor support and a relatively smooth execution, due in part to the responsiveness of the Prudential Regulation Authority," said Des Potter, managing director, GC Securities. "The decision by SCOR, a leading global reinsurer, to use the new UK regime was a bold decision and is a major boost for the competitiveness of the UK (re)insurance industry.”
GC Securities

Four separate severe weather outbreaks swept across the US during May, leading to extensive hail and wind damage. Total combined economic losses from just two of the events were minimally estimated at USD2.3 billion, with public and private insurers expected to cover more than two-thirds of the total, according to Impact Forecasting's monthly cat recap report. The final figure is expected to be even higher. Most of the damage occurred from the Rockies to the Mid-Atlantic.
Aon Benfield

Posted: Monday, June 18th, 2018