Fidelis plans new managing general underwriter
Fidelis Insurance Holdings has announced its intention to create a new managing general underwriter Fidelis MGU) which, subject to regulatory approval, will be separated from the existing balance sheet insurance companies. This new structure will allow each entity to focus on its core functions and specialisms, and provide clients, brokers and other stakeholders with continued levels of industry-leading service.
The Fidelis MGU’s principal equity investors will be Capital Z Partners, The Travelers Companies, Blackstone, Further Global Capital Management and Alfa Insurance. In addition, Blackstone will be leading the debt financing.
The newly created MGU will be one of the largest managing general underwriters globally, Fidelis said, with plans to originate and underwrite over $3 billion of gross written premium across a range of specialty insurance and reinsurance classes of business.
Upon separation, it is intended that the Fidelis MGU will provide a comprehensive range of services to the Fidelis Balance Sheet Companies, retaining its industry-leading underwriters and attracting additional talent across the broader Fidelis business.
From a client, broker and reinsurer perspective, it is expected that there will be no changes to the way in which Fidelis currently conducts its underwriting from its offices in Bermuda, London and Dublin.
The Fidelis MGU and Fidelis Balance Sheet Companies will continue to underwrite “with the same risk appetite”, Fidelis said, across the three main Fidelis business pillars, including bespoke, reinsurance and specialty.
Pending regulatory approval, the Fidelis Balance Sheet Companies are expected to benefit from providing long-term capacity for the Fidelis MGU along with a number of mechanisms to ensure alignment among the separated companies. All of the capital and risk transfer resources currently available to Fidelis brokers and clients will continue to be available, ensuring a seamless transition from the current to new structure.
The Fidelis MGU will be led by Richard Brindle, who will act as chairman and chief executive officer (CEO) of the MGU. A number of leading executives from the senior Fidelis team will be retained by the Fidelis Balance Sheet Companies.
This transaction and the launch of the Fidelis MGU is subject to a number of regulatory approvals and transaction steps.
Brindle, chairman, group CEO and chief underwriting officer of Fidelis, said: “Built on the best talent in the market, we are creating an MGU platform that will generate attractive returns for the shareholders of both of the separated businesses. Our success will be defined by the continued delivery of underwriting outperformance, aligned with our long-term philosophy of writing insurance and reinsurance in areas where deep expertise is required to deliver through the cycle. We look forward to the start of a long term and successful partnership between the companies”.
