Nephila gears up to launch new Lloyd's Syndicate targeting specialty market
Nephila Capital, a Bermuda-based investment manager specialising in reinsurance risk, is set to launch a new “profitable and efficient” specialty syndicate at Lloyd’s that will commence trading on January 1.
The new Syndicate 2358 at Lloyd’s will focus on short to medium tail lines of business, with capital provided through London Bridge Risk PCC (LBR PCC).
It will allow Nephila investors the opportunity to access the specialty insurance market in addition to the natural catastrophe and climate based strategies offered by the firm.
Nephila has been active in the insurance-linked securities (ILS) market for over twenty years and at Lloyd’s for nine years. Its Syndicate 2357 at Lloyd’s, which is backed by funds managed by Nephila, has been trading since 2013.
The latest move brings part of Nephila’s investment activity onshore in the UK.
Adam Beatty, chief executive officer of Nephila Syndicate, said: “With our existing Nephila Managing Agency and the worldwide market for specialty risk being centred in London, a new Lloyd’s syndicate was the obvious choice to further enhance our product offering. We’d like to thank Lloyd’s, our risk partners and most of all our investors for supporting this project.”
The syndicate 2358 portfolio will be managed by active underwriter Ross Louden, who added: “We aim to build a profitable and efficient syndicate. We will do so by working with people who value the tradition of strategic partnerships yet see the future being defined by a greater delineation between leaders and followers, enhanced placement efficiency and an increased reliance on data and portfolio management techniques.”
Nephila co-CEO Greg Hagood, commented: “Our investors expressed the desire to access additional non-correlating insurance risks through a trusted institutional manager and we have built a platform that we believe will deliver value for them over the coming years. Nephila has invested in the Lloyd’s proposition since its entry in 2013 and we look forward to developing this and other new products in the years to come.”
London Bridge Risk PCC was sponsored by Lloyd’s as part of its Future at Lloyd’s strategy. The PCC operates under the UK Risk Transformation regulations and provides an access point for both UK and international investors, including ILS investors, to deploy funds in a tax transparent way into the Lloyd’s market.
“Using the LBR PCC structure was an efficient way to bring our investors’ capital into Lloyd’s to back our new syndicate,” said Beatty. “It is encouraging to see an initiative like LBR PCC being introduced to the market by Lloyd’s and we are pleased to have had the opportunity to support it.”
Burkhard Keese, chief financial officer of Lloyd’s, stated: “I am again delighted to see LBR PCC being used to support further ILS investments at Lloyd’s and to welcome such a prevalent ILS Investor as Nephila to the platform. This underlines the importance of this initiative to the Lloyd’s marketplace and shows there is real momentum behind ILS support of Lloyd’s, which is great to see.”
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