Horseshoe to manage new Lloyd’s ILS vehicle
Bermudian-based insurance-linked securities specialist Horseshoe Group is to provide insurance management services for Lloyd’s of London’s new multi-insurance special purpose vehicle.
Lloyd’s today announced that it has sponsored the creation of an independently owned and managed UK protected cell company, London Bridge Risk PCC Ltd.
It said UK regulators had given approval for the SPV.
This appointment builds upon and adds to the previous success of Horseshoe as the insurance manager selected for five of the six existing British-based ILS vehicles and solidifies Horseshoe’s position as the largest ILS service provider in the world.
Andre Perez, Horseshoe’s chief executive officer, said: “We are honoured to be involved with this innovative ILS structure which reinforces further Lloyd’s commitment to the Future at Lloyd’s.
“We look forward to working with investors and members to expand a complementary mechanism by which capital can be deployed into Lloyd’s. More broadly, this new PCC reaffirms the ILS potential of the London Market and hopefully this is the first of many more to be established in the UK.”
Horseshoe, founded by Mr Perez in 2005, is an independent insurance manager and fund administrator dedicated to both the ILS and alternative fund markets.
It has offices in Bermuda, the Cayman Islands, United States, Gibraltar, Ireland, and London.
Lloyd’s said the approval is a key milestone for the Future at Lloyd’s strategy, which aims to create an insurance market that attracts new forms of capital. The new platform will make it easier for investors to access the Lloyd’s market and will benefit investors by offering a more transparent and efficient capital management process.
It said the PCC will provide 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. Lloyd’s members will be able to use the new vehicle to manage their capital requirements by attracting new classes of investors such as pension funds and will benefit from reduced set-up times and lower transactional costs.
In addition, Lloyd’s said standardised documentation and processes have been developed, designed to make the process quicker, more tax transparent and to streamline the approach to regulatory approval for investors. Provided new individual proposals utilise the standard documentation and stay within the regulators “scope of permissions”, it will be a simple notification process for each deal, removing the need for costly, and often lengthy, individual applications.
It said the new vehicle complements the more traditional approaches to deploying capital at Lloyd’s by providing additional optionality.
Burkhard Keese, CFO at Lloyd’s, said: “As part of the Future at Lloyd’s strategy, we continue to look at all ways we can make it easier and more efficient to deploy and manage capital at Lloyd’s. We are delighted that Lloyd’s has received regulatory approval to set up a new investment platform that will be available for all of the market to use.
“Through our sponsorship of the London Bridge Risk PCC we will give investors the option of a new tax transparent way to participate in the market with standardised documents and a much simpler repeatable process.”
He added: “ILS investment is not new to Lloyd’s, but this is the first time that a UK PCC has been set up as a platform to allow investors to back and provide capital to members at Lloyd’s. We look forward to working with investors and Lloyd’s members who wish to use this new PCC to structure their participation at Lloyd’s.”
Horseshoe Insurance Services Holdings Ltd was acquired by Artex Risk Solutions in 2019.
Horseshoe is now the global brand of ILS services for Artex.