Markel ILS unit Nephila holds AuM steady again Q1 at $6.8bn

Global re/insurer Markel held the line on assets under management at its ILS management unit Nephila again in Q1, holding the tally steady at $6.8 billion, but managed to lay claim to a major boost in revenues from the unit. 

The AuM tally is still down in excess of 30% from the mid-2021 peak, but the outflows were slowed notably in 2023. Management could go without mention of any outflows of freed up side-pocket capital, the likes of which had last struck notably in Q3 2023 and had hinted at minor outflows still in Q4. 

Instead, Markel could focus its comment on a rise in premiums ceded to the unit and an increase in revenues. 

Gross premiums written Q1 via the group's programme services and other fronting platforms to the Nephila funds rose 50% to $353.1 million.  Overall, the near doubling of premium volume from ‘other fronting activities’ (non-program services) was said to be “driven by growth of our property catastrophe and specialty programmes with the Nephila Reinsurers.”

Q1 revenues from the non-consolidated funds and units managed by Nephila nearly doubled to $19.2 million in turn. 

With assets under management flat over the quarter, Markel said the rise in revenues was “primarily due to changes in the mix of investment products within the funds,” a metric for which Markel provides no apparent data points. 

Within Markel, Nephila serves as the investment manager to several Bermuda-based private funds (the Nephila Funds) and funnels through reinsurance ILS while acting as insurance manager to several group Bermuda-based units and Lloyd's syndicates (the Nephila Reinsurers).

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