A new player has entered the Bermuda catastrophe retrocession market.
Brit Insurance Holdings PLC has signed contracts for the launch of a specialist Bermuda-based reinsurance company, Norton Re Insurance Limited, to write catastrophe retrocession business.
Using the underwriting expertise of the Brit Insurance retrocessional team operating from Hamilton, Bermuda, Norton Re will participate in the current renewal season for treaties starting next month.
As a lead investor, the U.K.-based Brit Insurance subscribed $21.1 million, giving it an overall interest of 19.6 percent of the initial $107.7 million capital. The remainder is owned by international institutional investors. HSBC Bank plc acted as adviser and placement agent.
Dane Douetil, chief executive officer of Brit Insurance, said he was delighted with the high level of demand from investors.
“As 2006 has progressed, terms and conditions and pricing in the retrocession market have strengthened further, and we and our fellow investors regard this as the optimal time to launch the new carrier,” he said in a statement.
Norton Re will be the carrier's first investment in an offshore underwriting business “and a further significant step in Brit Insurance's evolution into a widely diversified insurance group,” he said. “We believe that this innovative structure is attractive to capital markets and is a potential blueprint that we can consider for other classes of business with similar characteristics.”
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