Markel’s Nephila holds ground on ILS assets amid rising cessions & fees
Markel fully stemmed the slide of assets under management at its ILS management unit Nephila, holding AuM steady at $7.2 billion amid signs of increased premium cession to the units and rising fee income.
Q2's reading is the third consecutive quarter with stable AuM for the group of ILS units after the long slide from the Q2 2021 peak at just under $10 billion.
Markel claimed a hefty rise in premium cession to the units, although the picture was blurred by a change in reporting, likely following the sale of MGAs tied to the units in 2023 and sale of a licensed insurer unit as recently as June 2023.
Markel claimed it handed over $297.4 million in premium during the second quarter, a 70% gain on the prior year period. The smaller quota share cessions were said to have risen to $16.4 million.
Revenues of the Nephila companies of $20.8 million in the second quarter were said to be up 19% year on year. That put ILS-related service revenue ahead of cost for the first time since points in 2021, a review of financial statemen notes indicated.
Markel's ILS unit had suffered a notable reduction in ceded premiums via the parent and its fronting operations in the first quarter, but was able to brag of having stemmed the decline in managed assets for the first time in nearly two years.
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