Insurance company TIH’s subsidiary Starwind Specialty Insurance Services (Starwind) has collaborated with Stone Point Credit to establish Fractal Re, a collateralised reinsurer.
The launch, which includes a $270m equity capital raise, aims to bolster reinsurance capacity for Starwind’s diverse casualty programme portfolio.
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The capital raise included contributions from a mix of institutional and industry investors, including Nationwide and Enstar Group, as well as investments from the TIH investor group and the Starwind management team.
As part of the launch, State National will expand its partnership with Starwind by becoming the fronting carrier for Fractal Re.
The new reinsurer will engage in a diversified mix of casualty and specialty risks, leveraging Starwind’s expertise as a casualty managing general agency platform.
Starwind is engaged in offering niche and exclusive insurance products, generating in excess of $3bn in gross premiums written annually.
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By GlobalDataThe multi-year reinsurance agreement between Starwind and Fractal Re is set to take effect from 1 October 2024.
Concurrently, Enstar’s subsidiary has crafted an agreement offering sidecar investors a novation transaction option for achieving finality after a designated period.
This initiative, known as the forward exit option, is a bespoke solution by Enstar to cater to the needs of third-party insurance-linked securities investors seeking conclusive transactions.
Stone Point Credit will also play a role in managing Fractal Re’s investments, focusing on a diversified credit strategy portfolio that aligns with the reinsurer’s liability profile.
The transaction was facilitated by JP Morgan Securities , which acted as the sole placement agent.
BMS Capital Advisory provided financial advisory services, and Willkie Farr & Gallagher offered legal counsel.
TIH Underwriting CEO Bill Goldstein said: “The launch of Fractal Re demonstrates Starwind’s ability to meet the needs of our customers and distribution partners by expanding our casualty and specialty capacity.”
Stone Point Co-CEO Jim Carey said: “We believe Stone Point Credit’s experience managing capital for the insurance industry, combined with Starwind’s market leading underwriting, will enable us to generate substantial value for all stakeholders.”
Last month, Sedgwick, supported by Stone Point and specialising in claims management and technology-enabled business solutions, secured $1bn equity investment from Altas Partners.
