A new pilot designed to enhance the way insurance-linked securities investments are invested and managed has been announced by Schroders Capital.
The circa-$94 billion private markets business of Schroders Group collaborated with global reinsurer Hanover Re. on the proof of concept, designed to show how ILS funds may invest via a digital ecosystem in the future.
Tokenization and trading of reinsurance contracts on a public blockchain platform using smart contracts enables the automation of several time consuming aspects of the investments, streamlining processes with, for example, automated subscriptions and reduced settlement times.
It does not negate the importance of oversight from investment professionals but does have potential to improve customer experience with investors being able to hold their tokens alongside other digital assets in their own wallets.
Schroders Capital’s co-head of Private Debt and Credit Alternatives, Stephan Ruoff, noted that there are other benefits too.
“The success of this pilot showcases the immense potential for enhancing transparency, streamlining investment processes and improving client experience in the reinsurance sector,” he said. “It paves the way for a more interconnected and efficient digital ecosystem, and we are looking forward to exploring the broader application to wider investment scenarios and clients."
The firm has seen increased client demand for ILS investments, managing over $5 billion for clients according to its announcement in March 2024.
“With investor concerns over inflation and having to navigate higher for longer rates, portfolio diversification is key. Investors are clearly seeing the benefits of adding less-correlated assets such as ILS in a portfolio context,” Ruoff said at the time. “Fundamental indicators suggest a continuation of attractive conditions for ILS investors. Yields as well as underlying risk premiums remain very attractive as demand for insurance risk transfer remains high.”
Plus, a $400 million Commonwealth team departs to launch an independent family-run RIA in the East Bay area.
The collaboration will focus initially on strategies within collective investment trusts in DC plans, with plans to expand to other retirement-focused private investment solutions.
“I respectfully request that all recruiters for other BDs discontinue their efforts to contact me," writes Thomas Bartholomew.
Wealth tech veteran Aaron Klein speaks out against the "misery" of client meetings, why advisors' communication skills don't always help, and AI's potential to make bad meetings "100 times better."
The proposed $120 million settlement would close the book on a legal challenge alleging the Wall Street banks failed to disclose crucial conflicts of interest to investors.
Orion's Tom Wilson on delivering coordinated, high-touch service in a world where returns alone no longer set you apart.
Barely a decade old, registered index-linked annuities have quickly surged in popularity, thanks to their unique blend of protection and growth potential—an appealing option for investors looking to chart a steadier course through today's choppy market waters, says Myles Lambert, Brighthouse Financial.
