We strive for excellence. Our tight knit team of highly qualified professionals are passionate about servicing clients’ needs
Our success is due to the specialist skills and experience of our knowledge-based teams and professionals together with our reputation for innovation and strong corporate governance.
Operating from our headquarters in the UK, we work globally with institutional investors to deliver a comprehensive range of low correlation investments together with innovative fund structuring solutions for our clients.
We offer institutional investors access to alternative assets which deliver strong and stable returns, resistant to the high profile stock market ups and downs, whilst protecting capital values.
Our clients’ investment objectives are paramount. We adopt a collaborative approach where we fully understand our clients’ investment requirements and we then design suitable strategies to offer appropriate investment vehicles to deliver investment performance.
INSURANCE LINKED INVESTMENT STRATEGIES
Insurance linked investment strategies encompass a broad range of investment positions, markets and risks. Primary issuers of new insurance product to consumers and business are, unsurprisingly, insurance companies.
Insurance linked investments are created when the risks and obligations associated with a primary insurance contract are transferred to a secondary investor. The transfer of risk can happen in one of two main ways:
An example of this would be an insurance company looking to transfer risk from a book of their existing business to a secondary investor. This would typically happen in the form of reinsurance, a swap or bond. Secondary investor active in macro markets are almost exclusively institutions such as insurers, pension or hedge funds, asset managers or family offices.
An example of this would be an individual or business looking to sell their individual insurance contract to a secondary investor. This would typically happen in the form of the legal transfer of an individual insurance contract from one individual to a secondary investor. Again the secondary investor is typically an institution, but can also be another individual.
Types of Risk
The types of risks that can be transferred in an insurance linked investment take many different forms:
- Longevity and Mortality risks such as those associated with Life Insurance and Annuity contracts. An example of this would be an individual taking a Life Settlement, where they sell on their individual life insurance contract to a secondary investor. The secondary investor takes on the future premium committements under the policy, and receives the benefit upon maturity
- General insurance risks such as those associated with the potection of real estate, infrastructure, vehicles, businesses etc. An example of this type of transaction would be catastrophe bonds, where an insurer chooses to limit its exposure to a catastrophic event such as a Hurricane, by issuing a fixed term bond to a secondary investor. Repayment of principle would be contingent upon the catastophe not materialising.
- Investment risks structured within insurance contacts, for example fixed term endowment policies. The individual sells their policy on the secondary market for a one off payment, the secondary investor contiues to pay the premiums due under the policy and collects the proceeds upon maturity.
SL has over 30 years of experience working with
institutional investors to create bespoke alternative
investments specifically tailored around Insurance linked
Case Study 1
Closed ended fund launch
Background – SL engaged with a Canadian based consortium in the development of a closed-ended alternative investment fund investing in insurance assets.
SL brought over 30 years of experience specialising in secondary insurance markets, with a deep technical understanding of how to best optimise investor value through targeted asset pricing\acquisition and actuarial modelling of anticipated cash flows. SL offered its efficient, diligent and robust asset management processes, together with an established network of third-party servicing agents to engage as required.
The Canadian partner brought extensive experience operating within global capital markets, structuring and management of investment portfolios, investor relations and capital raising within the institutional and HNW investor space.
Creation of a Canadian Limited Partnership offering North American institutional and HNW individuals a fixed term investment in a highly selective portfolio of US and Canadian Life Settlements.
The first fund launched in 2013. The partner acting as the fund promoter and investment manager based in Canada, with SL maintaining the remit as the specialist investment advisor and manager of the Life Settlement portfolio. A second fund was successfully launched in 2018.
Case Study 2
Open ended fund launch
Background – SL engaged with an Asian based partner in the creation of a bespoke open-ended US Life Settlement investment, initially tailored towards HNW private investors; with a view to extending the offering into the broader Middle East, European and Asian markets.
SL brought extensive experience and knowledge of applying low cost structuring solutions for start-up portfolios, where keeping set-up costs and initial running expenses low is an essential part of protecting initial investment capital and providing the best opportunity for long term sustained growth and success. As an FCA regulated Alternative Investment Fund Manager, SL has a long and successful history of operating within the highly regulated UK financial sector.
The Asian partner brought a wealth of experience from their involvement in private equity and capital markets in Asia\Europe, especially in relation to the identification and introduction of niche investment opportunities to investors with low correlation to traditional capital market investments.
Creation of a UK Limited Partnership offering global institutional investors and HNW individuals access to an open-ended investment in a highly selective portfolio of US Life Settlements.
Launched in early 2014, maintaining a meticulous and disciplined investment strategy, the SL team has built a highly diversified and optimised portfolio of US Life Settlement investments. Through the continued development of new working partnerships in the Asia, Europe and the Middle East, the fund has doubled in size during 2020, whilst delivering steady and reliable investor returns.
Case Study 3
Administration & Servicing
Background – SL were approached by a European asset management company seeking specialist administration support for an existing portfolio of US Life Settlements. The asset management company was seeking a strategy to realise best value for investors with a medium to long-term timeframe.
SL brought 30 years of experience in delivering effective administration solutions for insurance assets, ensuring that individual policies are efficiently and carefully maintained and kept in force to the point of maturity claim or sale. SL’s access to US service partners coupled with its in-depth knowledge of tertiary markets – where existing portfolios trade with one another – allowed sale opportunities to be identified where appropriate to maximise investor value.
The European partner brought a mature portfolio of US Life Settlements, held within established structures, along with an existing network of investors.
Creation of a UK based service offering to ensure that sufficient liquidity was maintained to continue to service the Life Settlement portfolio, and policies remained in force to maturity or sale. Ongoing premium costs were minimised for investors through specialist ‘best in class’ premium optimisation techniques honed by SL over the years.
Around half of the portfolio has been successfully realised to date, with the balance of the portfolio on target to be realised in the coming years.