24 March 2015News

AQR to shut down Bermuda reinsurance operations

AQR Capital Management has revealed that it will close its Bermuda-based reinsurance operations, AQR Re.

AQR Re operates funds holding a global portfolio of reinsurance, with approximately $500 million of assets under management.

The business will cease writing any new or renewal business after April 1, 2015.

A statement from AQR said: “The fundamentals of the reinsurance industry have changed significantly since AQR’s entrance into the business in 2011.

“While the diversification benefits and relative returns of reinsurance as an asset class remain attractive, we have come to the conclusion that due to consolidating market dynamics, it will become increasingly difficult to put larger amounts of capital to work to achieve attractive risk‐adjusted returns for our investors, and ever more important to be in multiple lines of business, many of which we are not currently in.

“We are pleased that AQR’s reinsurance business has performed consistently across both of its funds, having provided investors with annualised net returns of 4.7 percent and 15.8 percent respectively, since its inception.”