Why a blended reinsurance portfolio offers a compelling alternative to traditional ILS: Resolute Global Partners

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As institutional investors seek resilient entry points into the re/insurance market, traditional collateralized ILS structures face ongoing challenges surrounding trapped capital and stacked fees. However, investment advisor Resolute Global Partners is presenting an alternative approach by integrating property treaty reinsurance, niche specialty risks, and primary U.S. insurance within a unified, vertically integrated platform.

In a recent interview with Artemis, Managing Partner Tom Libassi and Director Antonia Bryan explain how managing these distinct loss drivers creates a naturally downside-protected portfolio, offering a structurally efficient alternative to the traditional insurance-linked securities (ILS) model.

To begin, we asked the executives to share details surrounding Resolute’s strategy and why the company offers something different for investors looking to access the returns of the re/insurance market.

“We break the business down into two broad categories: reinsurance risk and insurance risk. What makes this very different from a standard ILS fund comparison is our broad access, track-record in niche sectors and perhaps most distinctly, our vertical integration. We literally go down to the end consumer in the United States,” Libassi explained.

He continued: “Within reinsurance, we split into two basic buckets. The first is property treaty, accessed through our Bermuda team, which writes almost exclusively US risk. The second is specialty reinsurance, which for the last 12 years has been primarily marine retro, a smaller, niche sector where we are one of only about 10 dedicated players. Our portfolio is underpinned by a proprietary actuarial model that our team has been using for over 30 years, and our risk management team overlays the portfolio to look at clashes between these two sectors.”

Libassi states that the experience that Resolute has managed to accumulate across reinsurance and insurance is what has allowed the company to solve structural problems that others simply tolerate.

The executive outlined that this is evident in how Resolute chooses to structure its collateralized business in marine specialty to address the issue of trapped capital.

“We structure our contracts with up to three additional premium payments. If a counterparty doesn’t give us our money back on the first review date, they pay an additional premium, and so on. This forces them to question whether they are holding the funds just for their own safety, or if there is a real potential loss. Given our size and experience, we can customize the product this way,” Libassi said.

Bryan also stressed that Resolute’s biggest differentiator compared to other firms is that it has broad market access and a deep level of expertise.

“Accessing these markets requires overcoming high barriers to entry. We have a Lloyd’s corporate member, a US insurance company, and we own our own Bermuda reinsurance company. This gives us the tactical flexibility to change as market conditions change. We can collaborate, control, and structure these contracts in different ways, particularly in these specialty markets where, given where property reinsurance rates are right now, we see a highly compelling opportunity,” Bryan told Artemis.

Attention then turned towards Resolute’s flagship vehicle, the 1609 Fund Ltd., which accesses the market through three proprietary subsidiaries: Prospero Re (specialty and property reinsurance), Producers National Corporation (U.S. primary insurance), and RGP Corporate Member (Lloyd’s of London).

This multi-platform structure also gives the Fund direct access and expertise across market segments unavailable to most investment vehicles.

Providing further details, Libassi said: “We have a rated carrier in Bermuda, one of the first non-traditional reinsurance companies to be rated there. This gives us a major advantage. Our objective is to raise our rating and do more business directly on the balance sheet, which is far more capital-efficient than running everything on a collateralized basis.”

Instead of venturing into new sectors, Libassi noted that Resolute chooses to look for more native opportunities within its existing lines that are often born out of large industry losses.

Using the marine retro market as an example, the executive highlighted how the space is “highly intriguing” right now due to two major events.

“First, the Baltimore Bridge proposed loss settlement recently spiked to $2.85 billion. This is a massive hit to the marine retro market, forcing competitors to dramatically increase reserves. We had fully reserved our contracts for this loss at zero the day it occurred, so we are unaffected,” Libassi said.

“Second, the Persian Gulf conflict is estimated to have generated at least $3 billion in losses, which will also flow heavily into the marine retro market. Because we strictly exclude war-on-land, political violence, and terrorism from our contracts, our book shrank slightly, but we avoided these losses entirely. We will continue to exclude the Persian Gulf in our upcoming renewals because we simply see no reason to take that risk right now,” he continued.

Bryan also outlined how Resolute aims to continue expanding its flagship vehicle.

“Our goal is to continue to grow, but it’s not necessarily about expanding into brand-new sectors. It’s about sticking to our knitting and doing what we do best. We want to find an edge or a new niche that aligns with our current footprint, rather than adding a completely new business line,” she explained.

“By maintaining that capital efficiency on the balance sheet and leaning into our underwriting discipline, we don’t have to buy the whole market. Our market access allows us to target specific, niche lines where we already have deep relationships, proven due diligence, and a clear understanding of the risk.”

To end, Libassi and Bryan shared how Resolute feels that inclusion of specialty lines into a blended ILS fund offering can create a more balanced platform for returns over the cycle.

“The way we approach this has proven its impact over time. Each of our sectors responds to different loss drivers and operates on different cycles — our marine and property reinsurance books are a clear example of this. In 14 years, our marine specialty book has seen only three years with negative underwriting returns, and those were each low, single-digit dips – with only one year overlapping with a drawdown in property. The marine book is not just diversification for the sake of diversification — it is an attractive return source in its own right, maintaining a positive IRR over 14 years despite significant market losses from the Ukraine conflict, aviation claims, and the Baltimore Bridge disaster. But this same logic extends across our entire platform — each line we underwrite is chosen because it brings distinct return drivers, not simply to fill a portfolio,” Libassi explained.

In practice, this means Resolute’s approach successfully reduces tail risk by actively managing the clash between property treaty, marine and liability lines, he further noted.

While long-tail liability is a key topic in the industry today, Libassi added that Resolute believes the best way to access medium-to-long-tail lines is through the Lloyd’s Market. He emphasised how the market’s three-year ‘reinsurance to close’ system is a highly disciplined structure where outside parties approve reserving decisions rather than leaving it solely to the syndicate.

“On the short-tail liability side in the US, our vertical integration gives us a massive advantage because we control the entire claims process. This eliminates the stacked expenses you typically see in the ILS space, where the claims administrator, the MGA, the fronting carrier or insurance company all take a cut. We eliminate those layers, which keeps our access costs substantially below anyone else’s. Frankly, I struggle to see how a traditional, collateralized ILS fund can access meaningful liability lines profitably,” Libassi added.

Bryan also explained that Resolute views these specialty lines as a natural complement to property cat exposure, while noting that the firm believes they are critical for downside protection.

“The way we structure the portfolio means we aren’t reducing our upside potential; in years past, it may have shaved a tiny bit off the median return, but it builds a far more resilient book,” Bryan noted.

“To do this successfully, you must have the right contract structures, proprietary models, and deep relationships. These specialty sectors have high barriers to entry, which allows strong pricing to sustain itself over time. You can see this reality in the players who try to enter Lloyd’s but fail to get onto the more established syndicates, yet historically, it is those exact veteran syndicates that consistently outperform during softer market cycles.”

Concluding: “Ultimately, specialty lines are necessary to round out your reinsurance exposure. If an investor is looking for non-correlated returns, we believe it makes more sense to add a line that is already in your comfort zone rather than underwriting an entirely new sector like life settlements. Our marine and property reinsurance books, and primary insurance books do not move in tandem, providing distinct return drivers and pricing dynamics when one market or the other softens. But as always, structure remains key.”

Read all of our interviews with ILS market and reinsurance sector professionals here.

Why a blended reinsurance portfolio offers a compelling alternative to traditional ILS: Resolute Global Partners was published by: www.Artemis.bm
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