Ryan Specialty just pulled a big one with Axis Capital. Together they launched Ryan Alternative Capital Re (RAC Re), a collateralized reinsurance sidecar carrying an expected $900mn of multiyear premium capacity into Ryan Specialty Underwriting Managers’ delegated authority property/casualty business.
The capacity didn’t appear out of thin air. RAC Re secured about $400mn in committed funds from Flexpoint Ford and Sixth Street, two investment managers with deep pockets and an appetite for insurance risk.
With Axis providing additional firepower through its Lloyd’s Syndicate 1686, the vehicle stretches into a multiyear, risk-attaching deal that bolsters RSUM’s growth ambitions.
Axis isn’t playing a passive role. Daniel Draper, the group’s chief underwriting officer, said the company worked closely with Ryan Specialty to handpick a portfolio of specialty managing general agents.
Each MGA matched Axis’ risk-reward tolerance and dovetailed with its delegated underwriting strategy.
Draper called the collaboration a way to sharpen their specialty footprint while grabbing targeted market share.
RSUM’s chief executive, Miles Wuller, pitched RAC Re as more than just fresh capacity. He said the platform creates room to absorb catastrophe and non-catastrophe risks across a mix of MGAs that don’t all move in the same direction.
According to him, that setup not only supports underwriting growth but also positions RSUM to respond quickly if the market stumbles.
This vehicle marks a significant opportunity for RSUM to accelerate solution delivery to the industry and rapidly respond to future market dislocation. Through this collaboration, we are advancing our specialty leadership ambition while expanding our reach into highly targeted markets
Daniel Draper, group chief underwriting officer, Axis, said
“We worked closely with Ryan Specialty to carefully select an attractive portfolio of specialty MGAs that fit our risk reward parameters and align with our delegated underwriting strategy and partnership criteria,” Daniel Draper said.
Danny Arnett, managing director of RSUM Alternative Capital, pointed to the structure’s insurance-linked securities format.
It combines cat and casualty into one instrument. He believes the team can run this play again and again, now that they’ve proven the transaction works in practice.
Ryan Specialty calls the vehicle a strategic extension. Investors call it an opportunity to ride specialty insurance cycles.
Either way, $900mn of fresh capacity changes the game for RSUM’s delegated authority platform.
