Ledger Investing Secures Major Funding with New Casualty Sidecar
Ledger Investing Secures New Casualty Sidecar
Ledger Investing, recognized as a significant player in the marketplace connecting insurance risks to capital, has recently announced a breakthrough in its operations. The company has successfully initiated a casualty sidecar facility, which is poised to channel up to $100 million into the reinsurance sector, marking a significant milestone in its market expansion efforts.
Funding Details of the Casualty Sidecar
This innovative sidecar will operate over a three-year capacity on a quota share basis, thus providing vital support to the casualty reinsurance business of a renowned global reinsurer. Ledger Re SPC, a subsidiary based in the Cayman Islands, will function as the retrocessionaire, offering institutional investors a unique access point to casualty insurance-linked securities (ILS).
The Role of Ledger Capital Markets
In addition to establishing the sidecar, Ledger Capital Markets played a crucial role as the sole structuring agent and bookrunner for this deal. This success reinforces Ledger's status as a leader in the casualty ILS sector, showcasing its dedication to providing innovative solutions.
Leadership Insights
Samir Shah, the CEO of Ledger, highlighted the importance of this development in their strategic growth. He explained, "Our expansion from primarily securitizing MGA-originated portfolios to supporting long-term capital management demonstrates our commitment to the reinsurance space. Our expertise in capital modeling and structuring allowed us to create a flexible solution that generates value for all parties involved."
Market Demand for Casualty ILS
Alex Freiberg, CEO of Ledger Capital Markets, emphasized the growing investor interest in casualty ILS, noting that the capital efficiencies this model offers are sparking increased demand from reinsurers eager to diversify their portfolios. This sidecar not only facilitates greater capital flow but also helps create a more resilient insurance market.
Company Background and Achievements
Founded in 2017, Ledger Investing has been at the forefront of casualty ILS development. Recognized in the CB Insights Insurtech 50, the company has evolved from a Y Combinator startup to an industry leader, securing over $90 million in funding from prominent venture capitalists and strategic investors within the insurance landscape. The launch of the first dedicated casualty ILS fund in 2021 stands as a testament to their innovative approach, having managed billions of dollars in gross casualty premiums through diverse transactions.
Ledger operates through multiple wholly-owned subsidiaries, including Ledger Risk Markets, LLC, a reinsurance intermediary; Ledger Capital Markets, LLC, a securities broker/dealer; and Ledger Re SPC, a class B(iii) insurer, among others. This extensive operational structure enables Ledger to deliver comprehensive risk management and investment solutions to its clients.
Conclusion
The successful launch of this $100 million casualty sidecar reinforces Ledger Investing's position as a premier partner in the casualty ILS marketplace. With its innovative approaches and dedication to capital efficiency, Ledger is poised to support the evolving needs of the reinsurance industry.
Frequently Asked Questions
What is Ledger Investing?
Ledger Investing is a marketplace that connects insurance risks to capital, specializing in casualty insurance-linked securities.
What is a casualty sidecar?
A casualty sidecar is a financial arrangement that allows investors to participate in reinsurance by providing capital for specific reinsurance contracts.
How much capital is involved in this sidecar?
The new casualty sidecar involves up to $100 million in capital to support the reinsurance business of a global reinsurer.
Who manages the sidecar?
Ledger Re SPC, a subsidiary of Ledger Investing, will serve as the retrocessionaire for the sidecar.
What are the benefits of insurance-linked securities?
Insurance-linked securities offer investors an opportunity to diversify their portfolios while providing reinsurers with additional capital efficiency.
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