Bermuda domiciled reinsurance and insurance-linked securities (ILS) focused investment fund manager, Aeolus Capital Management Ltd., launched a largely Florida-focused reinsurance facility at the June 1st, 2022, renewals, called Corbel, according to Artemis’ sources.
Our ILS-focused sister site, Artemis, reported yesterday that Corbel is mostly focused on providing reinsurance capacity to cedents in Florida, but also to some with additional risk in other coastal US wind-exposed states.
Sources told Artemis that the decision to launch Corbel at the 6/1 renewals was driven by the improvement in reinsurance rates and terms and conditions, which the firm feels have made certain underwriting opportunities more attractive than in the past.
It’s understood that Corbel was funded by institutional investor partners of Aeolus, with the entire raise deployed at or around the Florida, June 1st, 2022, reinsurance renewal.
According to Artemis’ sources, Aeolus saw, as a result of higher rates and tighter terms and conditions, a gradual risk-adjusted improvement in certain opportunities in the State of Florida. This includes things like more named peril specific covers, and an opportunity to get paid upfront for premiums via new schedules.
It’s been widely reported that a number of Florida focused carriers have struggled to fill their reinsurance programs for 2022, amid a pull-back from the catastrophe space, and notably in stressed markets like Florida, from providers of capacity. This retreat from the cat space from traditional and some alternative capacity has happened as reinsurance rates in the region are rising in a hardening environment, while demand for protection has remained relatively flat.
But with some finding it difficult to procure the desired level of reinsurance – highlighted by reports from brokers that some reinsurers were unwilling to offer capacity for certain business at any price – additional capacity from Aeolus’ new Corbel facility may well have played an important role for some in securing their go-forwards ability into the 2022 wind season.
According to Artemis, the new Corbel facility wrote exclusively single-shot occurrence covers that largely incepted on June 1st, with no reinstatements, some of which was reinsurance premium protection (RRP) limit.
Sources also explained to Artemis that the new offering was well-received by cedents and brokers.
