Bluefire will assume the risk from its personal auto portfolio through a collateralised reinsurance agreement with AXA XL
US-based managing general agency Bluefire Insurance and AXA XL Reinsurance in Bermuda have completed an alternative capital reinsurance transaction.
Under the terms of the transaction, Bluefire will assume the risk from its personal auto portfolio through a collateralised reinsurance agreement with AXA XL.
Bluefire Insurance offers a wide range of solutions in multiple states, with a focus on providing consumers with an excellent insurance product with great coverage at affordable rates.
Bluefire Insurance strategy head Jamie Pooley said: “Bluefire has a diverse and stable book of business with significant scale that is delivering consistent and predictable returns to our reinsurance partners.
“We have been exploring ways to reinsure our own business for some time but casualty quota share reinsurance agreements have an exposure duration which presents capital efficiency challenges.
“Once we explained our intent to take risk with the team at AXA XL, we collaborated to design a bespoke structure that met both parties’ objectives.
“We are delighted to have expanded and further aligned our relationship with AXA XL while creating a capital-efficient mechanism that captures the results we are producing.”
The transaction marks the first risk-taking position for Bluefire
AXA XL and Bluefire have been partnering since 2014, which was strengthened in 2019 with Bluefire consolidating its carrier assortment and transitioned its reinsurance buying to a portfolio basis.
The current transaction represents the first risk-taking position for Bluefire on its business and the first personal auto alternative capital transaction that AXA XL has completed in Bermuda.
Bluefire’s segregated cell ‘Bluefire ACR’ is managed by Quest Group, Bermuda and is accommodated inside RQIH, a Bermuda Segregated Account Company.
For the transaction, Walkers Bermuda has advised AXA XL, and Foley & Lardner advised Bluefire.
AXA XL property, global markets head Paul Simons said: “AXA XL Reinsurance is pleased to partner with Bluefire on this transaction. As a leading global reinsurer with experience in both the traditional and alternative capital markets, we offer customized, innovative solutions across a broad product offering.
“While most of our alternative capital solutions have been in the property catastrophe space, this transaction demonstrates our willingness and ability to provide alternative offerings in casualty and other lines of business.”