London-based reinsurance broker Benfield Group Limited said it has made a $20.5 million cash investment in Globe Re, a new, limited-life reinsurance vehicle aimed at participating in a portfolio of U.S. property catastrophe risks sponsored by Hannover Re.
Benfield Advisory, Benfield's specialist corporate finance and advisory business, is the joint structure and placement agent for the vehicle which will underwrite business from its June 1 inception.
Benfield said this is the third major sidecar vehicle to provide "significant capacity for U.S. natural catastrophe risks created by Benfield Advisory."
Grahame Chilton, chief executive of Benfield said, "Benfield Advisory led the way in creating capacity for our customers' Florida catastrophe exposures with Starbound I in 2006 and Starbound II in 2007. Once again, we have demonstrated the strength of our capabilities in the capital markets interface with the reinsurance sector. I am delighted that we have made an investment in this innovative vehicle."
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