Karson Management has launched Collateral Program and completes $825,000,000 collateral transaction for ING Insurance. The Karson company has formed a specialist alternative collateral provider Karson Capital, to provide collateral for international insurance and reinsurance companies, Lloyd's corporate members and other corporations to support their current and future regulatory and credit security requirements.
Karson Management has teamed up with ING Bank to arrange eligible Regulation XXX collateral for a large block of life insurance business ceded by Security Life of Denver Insurance Company to Security Life of Denver International through a wholly owned subsidiary of Karson Capital.
According to Karson Management, the form of collateral issued is a financial guarantee in the form of secured demand notes, which enable the ceding company to take credit for reinsurance or solvency relief under US insurance laws and UK insurance regulations.
The collateral provided will function as a practical alternative to LOCs and individually funded trusts and will be fully backed by a portfolio of high quality assets. The Karson Collateral Program uses intellectual property licensed from the RISConsulting Group and is administered by BNY Mellon providing collateral management, corporate trust and custody services.
Derrell Hendrix, CEO of Karson Management, said: “The Karson collateral service will provide the global insurance markets with an efficient, scalable, and price-competitive source of short and long term collateral that will compete favourably with conventional alternatives, where supply and pricing have been all over the map.
“It will also avoid the inadvertent investment risks and breathtaking complexity that characterized previous securitization efforts in the US life market. What we have built is simple, secure and standardized, while meeting the high quality security required by clients and the eligibility requirements of regulators.”