Wednesday, July 19, 2023

Cat Bonds/Reinsurance: "Bain Capital raises $1.15 billion for first fund dedicated to insurance investments"

Insurance is a hard industry to asset strip or dividend recap, the private equity giant must see straight-up profitability as the lure.

From Reuters via MSN, July 18:

Bain Capital has raised $1.15 billion for its first fund dedicated to investing in the insurance industry, as the private equity firm aims to create and invest in companies in the sector, a senior executive told Reuters.

The fund exceeded its initial $750 million target through backing from high-net-worth individuals, institutional investors and family offices. It will be deployed through Bain Capital Insurance, a dedicated investment arm the firm launched in 2021.

The new fund underscores the increasing role that private equity is looking to play in the insurance sector, as providers seek to cut costs by shedding assets, which buyout firms can manage more efficiently and grow through add-on acquisitions....


Related in spirit, June 22:

Catastrophe Bonds; Reinsurance: "City of Zürich Pension Fund ILS allocation surpasses $700m"
There's some information embedded in this position. As we noted in the introduction to a 2021 post on the city doubling their exposure to cat bonds/Insurance Linked Securities:

The next time Munich Re starts moaning about climate change and how we're all going to die, or at minimum go broke, just remember reinsurance/cat bonds are a for-profit business and that some folks a couple hundred miles southwest of München, who might have access to some very sharp minds in the reinsurance/cat bond business, seem to think this is a profitable place to put some longer term money....