• Flatiron Re has been set up to provide reinsurance solely to Bermudian reinsurer Arch Re. Standard and Poor's has assigned Flatiron Re a BBB- rating.
Flatiron Re can borrow up to $520 million from a consortium of banks for up to five years, receive equal amounts of equity from investors in its parent company, and invest the proceeds in a portfolio of securities in a collateral trust account. The assets in the trust account provide Arch Re with a source of indemnity cover for losses from property-catastrophe lines of business.
Arch Re will make quarterly premium payments to Flatiron Re through a quota-share reinsurance treaty.
• GMAC Re, part of GMAC Insurance Group, has formed a new operating unit called Strategic Risk Specialists. It will specialise in excess and surplus lines property business. It will be based in Napa, Calif. in the U.S.
GMAC has appointed Steve Brett to head Strategic Risk Specialists. Brett was previously chairman and chief executive of special risk operations at Fairfax.
The new unit commenced operations on Jan. 1.
• Members of the International Underwriting Association are to test a new electronic claims system. The system is designed to speed up the settlement of insurance and reinsurance claims in the London market.
• AM Best has assigned a B+ financial strength rating to Turkish insurer Milli Re.
• Risk modeller AIR Worldwide has released a new winter storm model for the U.S. The model assesses the effects of wind, precipitation and freezing temperatures on insured properties.
• Canadian life insurer Sun Life Financial will issue C$250 million ($215 million) in preferred shares. The shares will be priced at C$25 a share. The net proceeds raised will be used for general business purposes. The offering is expected to close on Jan. 13.
• Rating agency Fitch has assigned a BBB financial strength rating to Taiwanese insurer China Life Insurance Company.
• Consolidation in the global life insurance market is likely to accelerate in the coming years, according to Swiss Re's latest Sigma publication. The reinsurer said life insurers' increased capital in the past two years and the highly fragmented life insurance market support this trend.
• Broker Brown & Brown has completed its acquisition of reinsurance broker Axiom Intermediaries for an undisclosed sum. Brown & Brown will merge its existing reinsurance broking arm into Axiom.
• U.S. insurance group WR Berkley has unveiled two new ventures in two days. On Jan. 4, it announced that it had set up Berkley A&H, an underwriting company that will write accident and health insurance and reinsurance on behalf of the group's subsidiaries. Donato Gasparro has been appointed president of the new unit.
And on Jan. 5 it announced the formation of Berkley Net Underwriters. The initiative will allow Berkley's producers to quote and bind business online on behalf of the firm's subsidiaries. Net Underwriters will initially focus on workers' compensation business, but plans to expand. John Goldwater has been named president of the new venture.
