9 May 2014 Alternative Risk Transfer

JLT Capital Markets unveils new ILS platform

Jardine Lloyd Thompson Capital Markets (JLTCM), part of JLT Towers Re, has completed a $10 million catastrophe bond for an unnamed cedant using a newly formed vehicle designed to make the capital markets more accessible to issuers looking to do smaller-sized cat bonds.

Market Re 2014-1 provides two year indemnity-based collateralized catastrophe reinsurance coverage for the unnamed cedant’s Florida book of business. The new platform has been developed by JLTCM in conjunction with other partners including the Bermuda ILS management specialist Horseshoe Group.

“At JLTCM, we remain focused on the democratisation of the capital markets so that issuance doesn’t just remain the domain of larger cedants,” said Rick Miller, managing director and co-head of ILS at JLTCM.

“We are delighted that we have been able to create a more cost-effective vehicle that will enable cedants to source capital markets capacity for even smaller deals. For investors, we are confident that Market Re transactions will allow us to continue to bring new cedants and perils to them in a manner that will allow them to diversify their portfolios.”

Michael Popkin, managing director and co-head of ILS at JLTCM, added: “We have worked closely with our strategic service partners to build a scalable vehicle that will open up a wide-range of possibilities for our clients. With the growth of alternative capital and the rise of the reinsurance manager, we wanted to find innovative ways to bring cedants and investors together. Bringing this first (of many) Market Re transactions required the close coordination among all of the service providers, the cedant, and the investors. It was really a team effort.”

Andre Perez, CEO of the Horseshoe Group, added: “The Horseshoe Group is excited to work again with JLTCM to find new and creative ways to bring more opportunities to the ILS markets. Market Re is a natural extension of our growing transformation platform, and we are pleased to have collaborated with JLTCM. For several years now, we had ILS investors asking for ways to participate in the collateralized reinsurance market via the purchase of tradable notes; they can now do that via Market Re.”

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