Lancashire Launches $250M Saltire Facility
Bermuda-based Lancashire Holdings Limited will shortly launch Saltire Re I Limited, a fully collateralised Bermuda incorporated special purpose insurer. Saltire Re I will have capacity of up to US$250 million and the share capital will be owned by a syndicate of investors.
Lancashire itself will invest approximately $33 million in Saltire Re I. Saltire Re I will underwrite a combined exposure ultimate net loss aggregate reinsurance product for the January 2013 reinsurance renewal season. Lancashire has also launched Saltire Management Limited, which is wholly owned by Lancashire and will provide underwriting services to Saltire Re I.
Lancashire CEO Richard Brindle said: “The formation of Saltire Re I and Saltire Management marks an exciting new chapter in Lancashire’s story. Following the successful launch of the Accordion sidecar in 2011, the creation of the Saltire vehicles represents a further development of Lancashire’s strategy to build partnerships with capital market participants.
“It affords the investors in Saltire Re I access to Lancashire’s underwriting expertise, and allows Lancashire the ability to generate fee income. We have listened to our clients and brokers and believe that there will be an appetite for the Saltire Re I product.”
Lancashire CFO Elaine Whelan said: “The Saltire model will be capable of replication and should prove attractive to both investors and clients in the future as opportunities arise. It will give Lancashire the opportunity to leverage its underwriting expertise whilst affording flexibility in the management and deployment of its own capital.”
All contracts underwritten by Saltire Re I will be collateralised for the benefit of its reinsured customers to the full extent of Saltire Re I’s potential policy liability. Both Saltire Re I and Saltire Management have been authorised by the Bermuda Monetary Authority.
