Ledger Investing launches the Nanorock ILS fund for property and casualty
Ledger Investing launched its first Insurance Linked Securities (ILS) fund, a property and casualty risk driven strategy supported by a single investor and ILS management unit, Ledger ILS Managers LLC. While the company is also planning a mixed ILS fund strategy of $ 300 million.
Using its own technology platform, a marketplace to connect investor funding in the capital markets with insurance and reinsurance risks, Ledger Investing announced the closure of Nanorock Fund Ltd.
The Nanorock Fund will invest primarily in non-life insurance risks through the Ledger Connect platform, its proprietary technology platform, with a range of longer-term lines of responsibility.
The Nanorock fund will be able to invest in workers’ compensation, general liability, commercial and private automobile liability, as well as other property and casualty insurance risks in the United States and Europe, explained Ledger Investing.
The Nanorock Fund has been funded by a single large pension plan, just like a fund of one.
This is the first damage-specific ILS fund strategy in the market and Ledger plans to turn the strategy into a multi-investor structure as well, with a blended fund currently in the works for which he is aiming for a close of $ 300 million. , the company explained to Artemis.
This should prove attractive to more sophisticated investors looking to access diversification within the ILS and reinsurance space.
The risks of damage have been addressed in ILS, with a number of deals completed and some managers seeking longer term returns. In addition, the sidecar space in quota was subject to certain risks of injury.
But Ledger’s new fund and the next combined release are the first managed investment funds with a specific focus on accident risk.
The planned mixed ILS fund will have the same investment mandate as this single fund, explained Rajiv Punja, CEO of Ledger ILS Managers, LLC to Artemis.
He further explained that the non-life insurance or reinsurance business in which the Nanorock ILS fund invests will usually come directly from originators, therefore general agents (MGA) and others, but Ledger will also work with brokers in some cases.
Ledger Investing has also launched its own specialized ILS investment management unit, Ledger ILS Managers LLC, which is a wholly owned subsidiary and an SEC registered investment advisor.
Commenting on the launch, Punja, CEO of Ledger ILS Managers, LLC, said, “We are honored to have received the support of a sophisticated ILS institutional investor who shares our perspective on whether to invest in the determined to grow the asset class.
“The substantial commitment and strategic direction of the investor marks a turning point for the institutionalization of P&C securitization,” added Samir Shah, CEO and co-founder of Ledger Investing. “The market continues to support our belief that the most promising path for exponential growth is to leverage technology to bring ultimate capital providers closer to risk initiators, standardize securitization structures, and provide risk analysis and insight. advanced transparency. “
“The Fund allows us to rapidly deploy capital to meet the long-term capacity needs of General Management Agencies (‘MGAs’) and insurance companies while providing attractive and diversified returns to our investing partner,” Brad Fischtrom, COO of Ledger Investing, Inc. stated.
In chatting with Rajiv Punja, CEO of Ledger ILS Managers, LLC, we explored the Ledger Investing strategy a little more in depth and how it brings value to cedants and capital market investors.
Punja told us, “It’s not about more efficient capital, it’s about creating a more efficient value chain, with transparency and hard data analysis for accident risk.
“Right now, our MGA value proposition consists of multi-year capital commitments, objective pricing and risk analysis, and rapid time to market. We let risk creators do what they do best, research and manage risk.
“We help them fund this risk by bringing transparency to the value chain, allowing investors to gain unprecedented insight into the risks they are taking. This opens up a universe of investors traditionally put off by the opacity of the value chain and the risks they take.
“We are looking to do for insurance what securitization has done for credit. For risk initiators, it is about capital management rather than risk management.
The ILS property and casualty fund might just be Ledger’s starting point, with other categories of businesses clearly likely to benefit from this data-driven, partnership-based approach as well.
But for now, the focus is on the new ILS property and casualty insurance strategy, a unique offering in the ILS fund market, and raising the $ 300 million for an ILS mixed accident fund is the next priority, after this unique fund launch.
“From the Fund’s perspective, we will continue to focus on the frequency accident portfolios. Ledger’s vision for value chain transparency begins with a data pipeline. We use our data advantage to value and offer securities in the capital markets and to create a market for those securities. We think this is just the tip of the iceberg. Insurance decision-making (both internal and external) should be based on real-time, single-source data. We are working on the technology to make this possible. Think of us as the Plaid of Insurance. You come to us to access the capital markets. You stay for everything we offer! said Penja.