Headwinds see Markel close ILS fund business

Markel Corporation has announced it is winding down Lodgepine Capital Management, its retrocessional insurance linked securities (ILS) fund manager based in Bermuda.

The re/insurer launched Lodgepine in 2019, with product offerings focused on property catastrophe retrocessional investments. In 2021, it wrote a portfolio of property retrocessional business that consisted of approximately $230 million of initial limits. The Lodgepine Fund launched in January with initial investor capital of $98.9m, including an initial investment by Markel of $18.9m.

“Despite best efforts and in light of headwinds in the retrocessional ILS market, including a challenging fundraising environment, Lodgepine will cease to write any new business and commence the orderly run-off of its existing portfolio and the return of capital to investors,” it announced yesterday.

The company has entered in consultation with the manager’s 18 employees and will look for redeployment opportunities within Markel, it added.