New reinsurance company, Alesia Re, SPC received regulatory approval from the Cayman Islands Monetary Authority to act as a Class D reinsurer.
The segregated portfolio company will focus on reinsuring large blocks of pension risk transfer group annuity contracts and other low convexity and long-duration annuity business. In addition, the firm’s objective is to provide sustainable risk-sharing capacity through structuring, investment management and enterprise risk management.
Richard Kearns, Alesia Re’s chief executive officer, said the reinsurer chose to headquarter and domicile in the Cayman Islands because of the jurisdiction’s “unique collaborative approach, which provides for robust regulation with an attractive business environment.”
He said, “The Ministry for Financial Services and the Cayman Islands government, the Cayman Islands Monetary Authority, and Cayman Finance, as well as its professional service community members, have been exceedingly supportive and have demonstrated a commitment to growing the Cayman Islands’ presence in the international reinsurance sector.
“They all recognized the specific needs of Alesia’s business model and worked with us as any issues arose,” he noted. “As the Cayman Islands’ insurance industry continues to expand, especially in the life and annuity sector, Alesia Re looks forward to building upon this superb framework and benefiting from Cayman’s long-term dedication to implementing industry best practices.”
Bryan Hunter, managing partner of Appleby Cayman, which acted as legal counsel for the reinsurer, said Alesia Re’s choosing the jurisdiction is a positive development for the insurance sector and Cayman in general.
“The establishment of this reinsurance company in Cayman is truly a testament to the collaborative approach of public and private sector partners who continue to work tirelessly to attract new Class D reinsurers,” he said.
The Portfolio Insurance Companies legislation, enshrined in the Insurance Law, 2010, provided a unique and robust structure for Alesia Re to conduct its reinsurance business, Appleby said in press statement.
Appleby said the Cayman Islands Insurance Law, which was introduced to provide a risk-based regulatory framework for the insurance industry, has streamlined licensing and regulatory procedures and adjusted capital models to make it attractive for reinsurers to domicile in Cayman.
The PIC legislation provides a practical legal solution for Segregated Portfolio Companies to transact insurance business between individual cells to facilitate reinsurance and quota sharing. The PIC regime also allows for governance flexibility, additional segregation of assets/liabilities resulting from a separately incorporated legal entity and an easier transition to a standalone captive than an unincorporated cell, Appleby noted.
Cayman Finance CEO Jude Scott welcomed Alesia Re “as it joins the growing list of significant reinsurance companies selecting the Cayman Islands as their domicile of choice.”
He said, “The excellence in service and strong collaboration across the industry, the government, and the Cayman Islands Monetary Authority continue to position the Cayman Islands as the premier global financial hub for financial services including traditional and non-traditional reinsurance.”