Fleming launches REvolve platform, enhancing casualty ILS offering

Fleming Insurance Holdings, a capital solutions provider with a casualty focused insurance-linked securities (ILS) offering, has launched a new technology and AI-analytics platform named REvolve™, that it says facilitates smooth, recurring transfer of liabilities and enhances its casualty ILS offering.

The REvolve™ platform from Fleming allows for the evaluation of risk and provides artificial intelligence (AI)-enhanced insights, to allow for more granular understanding and for retrospective reinsurance transactions to be structured around the insights it provides.

The new platform brings together Fleming’s proprietary PlannedLPT™, ReSolveRisk™, and RevealAI™ solutions, which can deliver ongoing insights to help parties mitigate risk, streamline their operational efficiencies, and deliver value for its counterparties.

The PlannedLPT (or loss portfolio transfer) is of particular relevance to those in the growing segment of the insurance-linked securities (ILS) market that look at casualty risks.

With exit strategies seen as critical for the development of the casualty ILS marketplace, given investor need for clear liquidity options and horizons, Fleming believes it is bringing together the pieces within its platform to help facilitate smoother casualty ILS transactions.

“As the REvolve™ name implies, revolving capital solutions are going to drive the evolution of retrospective reinsurance. Fleming has always had a partnership mentality that is focused on continuously improving risk and outcomes for counterparties and stakeholders,” explained Eric Haller, CEO of Fleming.

“The launch of our comprehensive platform is a crucial step forward for the industry as it modernizes its risk mitigation capabilities. We’re looking forward to collaborating with our partners through REvolve™ to bring them the best solutions possible.”

Speaking with Artemis, Haller provided some insights into why the new platform is relevant to the casualty ILS market and investors looking to access the returns of casualty reinsurance arrangements.

Haller told us, “The REvolve platform is essentially structured around our PlannedLPT solution. PlannedLPT is going to be able to shorten the investment horizon, allow access to more investors, and really start to securitize the casualty ILS space.”

Haller believes that REvolve can help to drive an expansion of the casualty ILS market, by providing transaction focused insights and certainty.

“Fleming’s paradigm-shifting REvolve platform has paved the way for fundamental improvements in the retrospective reinsurance market and structural changes to facilitate the expansion of the Casualty ILS industry,” Haller explained “For example, our RevealAI technology enhances due diligence and ongoing claims management to provide a more stable liability stream. On top of that, our PlannedLPT solution facilitates recurring future transactions, with known pricing and timing. The combination of these leads to the building blocks of securitizing the casualty liabilities.”

Key to that is the exit functionality that Fleming has developed, to enable investors to garner more certainty on pre-arranged commutations from the risk they have been backing.

“Utilizing our proven PlannedLPT solution, Fleming is able to customize the Casualty ILS investment horizon, which in turn will expand the potential investor universe by eliminating the long duration constraints on certain lines of business,” Haller said.

“Specifically, Fleming is able to provide pricing at any point in time in the liability lifecycle coupled with a pre-determined commutation earlier than current offerings in the market.”

Innovation around exit points from legacy reinsurance and longer-tailed casualty risk focused reinsurance transactions is key to the development of the casualty ILS asset class.

Alongside data to provide transaction insights and analytics, the exit solution market is developing at pace and this should give investors increasing confidence in casualty risks becoming a more accessible asset class, for their investments, over time.

Haller also commented on the Fleming mission in legacy and retrospective risks, saying, “When we started Fleming, we wanted to change the paradigm of legacy reinsurance. We saw that the market was offering a homogenous solution. Our goal was to create new solutions based on recycling capital for our counterparties and facilitate recurring transactions. This partnership mentality results in mutually beneficial economic outcomes that did not exist in the historical legacy space.

“We look at our counterparties as partners, which means a longer-term relationship. Anything we can do to improve the risk of their underlying book means the liabilities we eventually get have less volatility associated with them, and we can pass that on through favorable terms of structuring and pricing.”