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W. R. Berkley (WRB) Introduces Special Purpose Reinsurer

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Zacks Equity Research
·3 min read
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W.R. Berkley Corporation WRB has launched a special purpose insurance agency in Bermuda, Lifson Re, licensed by the Bermuda Monetary Authority.

Lifson Re received an equity capital of over $250 million from a group of global investors that also includes a minority participation by W. R. Berkley. Starting from Jan 1, 2021, Lifson Re will work alongside traditional reinsurers in property and casualty reinsurance deals ceded by subsidiaries of W. R. Berkley on a collateral basis. Lifson Re will act as a traditional sidecar in W. R. Berkley’s reinsurance program tower, where capital will be furnished by third-party investors.

As part of the strategic initiative, the property and casualty insurer launched Lifson Re for the efficient management of risk and capital. This newly created venture will assist the insurer in forming partnership with knowledgeable third-party capital, having exhaustive experience in the insurance industry. The creation of Lifson Re is a strategic fit for W.R. Berkley as it enhances the insurer’s long-standing relationships with traditional reinsurance partners.

This is an extension of the company’s own capital and capacity, which allows the insurer to write more risk on its own capital while earning fee income through ceding some of that business to an efficient and managed third-party source of reinsurance.

The launch of the new special purpose insurer will boost the Reinsurance & Monoline Excess segment of W.R. Berkley that provides other insurance companies and self-insureds with assistance in managing their net risk either through reinsurance, treaty reinsurance or facultative reinsurance. This in turn will enhance premiums for property and casualty reinsurance and drive revenue growth.

Shares of this Zacks Rank #3 (Hold) insurer have lost 4.9% in the past year compared with the  industry’s decline of 2.2%.

Stocks to Consider

Some better-ranked players in the property and casualty industry are Alleghany Y, Fidelity National Financial FNF and The Allstate Corporation ALL, each carrying a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

Alleghany’s bottom line surpassed estimates in two of the last four quarters and missed in the other two, the average beat being 34.08%.

Fidelity National Financial surpassed earnings estimates in each of the last four quarters, the average surprise being 30.48%.

The Allstate surpassed estimates in each of the last four quarters and missed in the other one, the average beat being 38.59%.

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W.R. Berkley Corporation (WRB) : Free Stock Analysis Report
 
The Allstate Corporation (ALL) : Free Stock Analysis Report
 
Fidelity National Financial, Inc. (FNF) : Free Stock Analysis Report
 
Alleghany Corporation (Y) : Free Stock Analysis Report
 
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