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Helios Underwriting, which provides investors with a limited liability direct investment into the Lloyd's insurance market, has used a fully collateralised quota share reinsurance contract to release capital, allowing it to seek new opportunities.
The arrangement, with Everest Re and Guernsey insurer Polygon Insurance via a special purpose vehicle, contributes £2.6 million to the company's funds at Lloyd's (20 percent of the company's regulatory capital requirement), the majority of which will immediately release corresponding group resources for reinvestment in new opportunities.
The deal means that some 20 percent of the company’s 2014 exposure has been ceded to reinsurers. This is in addition to a 50 percent reinsurance cover, which increases reinsurance cover to 70 percent and broadens the base of the company's reinsurance providers.
Nigel Hanbury, Helios chief executive, says: "These transactions present HUW with further capital with which to fund near-term opportunities the company wishes to pursue and does so on advantageous commercial terms. Current market conditions continue to present the company with attractive investment opportunities which require funding. The reinsurance terms provide both a profit commission in good underwriting years and a reduced risk exposure."
Everest Re, Helios Underwriting, Lloyd's, reinsurance, Nigel Hanbury