Randall and Quilter Investment Holdings (R&Q), a specialist non-life legacy insurance investor and capacity provider, completed 17 legacy acquisitions of portfolios or insurance companies/captives in 2018.
The R&Q final results for 2018 revealed that the pre-tax profits from continuing cooperations were £14.3 million, up 45 percent in comparison to 2017 (£9.8 million).
Additionally, the results show that the 17 acquisitions of different portfolios or companies/captives represent £18.5 million in net reserves.
At the beginning of 2018,
R&Q sold its insurance services and captive management operations to Davies group as part of its strategy to simplify its operations and focus on the acquisition of run-off portfolios.
The acquisitions included the agreed acquisition of Global Re, R&Q’s largest ever legacy transaction costing $80.5 million, which is expected to complete in the first half of this year.
Ken Randall, group chairman and CEO, suggested the Global Re deal demonstrates that the company is “increasing the size threshold of the transactions they can execute”.
He added that they will continue to acquire smaller-to-medium sized portfolios from internally generated cash flows.
Randall said: “With owners of discontinued portfolios increasingly seeing the attractions of freeing up resources by divesting their run-off businesses, we are confident that we will complete more legacy transactions in terms of total net reserves, than in 2018.”
“Our legacy pipeline remains very active with continuing evidence that insurers are increasingly turning to run off specialists to offload discontinued portfolios of insurance business in order to improve their capital efficiency and reduce costs of managing non-core activities.”
He continued: “There was a time when run-off was regarded as the ugly duckling of the insurance industry; it has matured into a vibrant and respected segment of the market and is now viewed as a natural component of the underwriting life cycle requiring specialist skills.”
“This should underpin the long-term supply of new legacy opportunities.”
