Legacy specialists RiverStone International has used a Guernsey incorporated cell to secure multi-year excess of loss reinsurance cover to support a series of Lloyd’s transactions.
Xenon IC Limited has been established within White Rock Insurance (Guernsey) ICC Limited, owned and managed by Aon, with financing of the deal led by JP Morgan.
The deal follows that executed by Lloyd’s itself to secure five-year reinsurance cover for its Central Fund in 2021, also utilising White Rock Insurance (Guernsey) ICC Limited.
The transactions are further evidence that cell companies, and Guernsey incorporated cell structures in particular, are becoming increasingly mainstream, trusted vehicles for a variety of reinsurance deals.
Incorporated cells have also been used for huge pension longevity swap transactions, with the BT pension scheme executing a £16bn deal through a Guernsey ICC in 2014. Several similar transactions have been completed since using Guernsey incorporated cells.
“We are delighted to have completed this significant reinsurance placement which demonstrates our strong focus on maintaining a highly efficient and flexible capital structure in support of our legacy solution offerings,” said Andy Creed, RiverStone International CFO.
RiverStone said the deal “provides a fully collateralised layer of reinsurance supporting RiverStone International’s Funds at Lloyd’s, and has the ability to grow or shrink in line with the future underwriting activity of RiverStone Syndicate 3500”.
Creed added: “Aon’s engagement and creativity combined with the support and commitment from one of the world’s largest investment banks, JP Morgan is testament to RiverStone International’s leading market presence in the legacy sector
“The product supports the ongoing growth of our syndicate, strengthens security for our customers, and enables us to continue to deliver effective legacy solutions to our Lloyd’s clients.
“In conjunction with the new reinsurance, we have also extended the funding provided by other third-party capital providers, who continue to provide strong support to our growing business. Our capital management and funding position is now more resilient than ever.”
RiverStone said the deal “provides a fully collateralised layer of reinsurance supporting RiverStone International’s Funds at Lloyd’s, and has the ability to grow or shrink in line with the future underwriting activity of RiverStone Syndicate 3500”.