TEAM develops the GARNet investment structure for re / insurers


Bermuda-based company TEAM International (Holdings), Ltd., has announced the development of a new investment structure for application in the insurance and reinsurance industries.

The Guaranteed Adjustable Rate Note (GARNet) has been specially designed for high quality long-term investors, with reinsurers seen as particularly likely to benefit from their capital efficiency when held on the balance sheet as investment asset.

TEAM explained that its GARNet product is a Guaranteed Investment Contract (GIC) and has features that provide for expected high NRSRO and NAIC ratings, which may result in low capital charges for note holders.

The Notes are structured to allow an investor to aim for above-market returns, through the implementation of a proprietary investment strategy comprised of low-risk assets such as US Treasury zeros or other equity assets. sovereign debt equivalents.

These provide for minimum principal and interest payments, while a portfolio of higher yielding investments linked to the structure of the Notes may increase returns.

Gallagher Re

TEAM believes that its new investment product can help increase the credit quality of investor GARNet’s portfolio.

“GARNet is supported by TEAM’s reinsurance, bond insurance and capital market leaders who have long been associated with Bermuda and New York,” said TEAM President Andrew A. Alberti.

“This new capital solution,” added CEO Dennis A. Szal, “is based on the many advantages of the Bermuda SAC Act and New York GIC legislation which has been in effect since the early 1960s, with its simple transparency now a staple of insurance companies’ products.

TEAM believes that a GARNet’s proceeds can protect GARNet holders, while helping third-party insurers with hard-to-place insurance, ILS tranches, or other strategic goals.

Strategic goals may include GARNet series suitable for: sidecars, first layer medical malpractice or utility transmission and distribution lines.

TEAM also said it plans to run a reinsurance business model, including reinsurance, bond insurance and asset management, through its new GARNet in the form of a traditional guaranteed investment contract.

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