Aspen Capital Markets AuM reaches $918m, fee income hits $61.4m

Aspen Insurance Holdings Limited, the Bermuda headquartered insurance and reinsurance company, has increased its third-party and insurance-linked securities (ILS) assets under management to almost $918 million, while earning $61.4 million in fees from these activities in 2021.

The capital utilised in Aspen Capital Markets’ activities at the company rose by some 35% over the course of the last full-year and roughly 8% in the second-half of 2021 alone.

Perhaps more impressive though, fee income earned rose considerably for the Capital Markets’ unit in 2021.

$32.6 million of fee income was earned by Aspen from its Aspen Capital Markets operations over the full-year of 2020.

But in 2021, that almost doubled, with fee income coming out at an impressive $61.4 million.

Mark Cloutier, Group Executive Chairman and Chief Executive Officer of Aspen, commented, “Our well-established Capital Markets business, Aspen Capital Partners, is a core part of our strategy at Aspen, and managed capital grew to more than $900 million.

“This is particularly pleasing, given the challenging renewal environment that many capital market vehicles have experienced recently, and it reflects the sophistication of our solutions across both property and casualty lines of business, the depth of our investor relationships and our established track record.”

Aspen has been leveraging third-party capital across its business, bringing investor funding into almost every line of business the company underwrites.

In recent years the company has become recognised for offering investors a way to access a more diversified ILS investment opportunity, than the pure property catastrophe reinsurance alone strategy of many independent or aligned ILS managers.

This drives benefits directly to the business unit the risks are underwritten by as income from Aspen Capital Markets’ activities is primarily allocated to the line of business being ceded, the company explained, which it says “serves to reduce acquisition expenses for that business.”

The company further said that, “Our continued ability to grow the capital we manage underpins our view that capital markets business and investors are key partners in Aspen’s further growth and innovation efforts.”

That is clearly standing the company in good stead and Aspen now sees an opportunity to continue driving benefits and increasing fee income to augment its bottom-line.

Cloutier explained, “We expect to see continued growth in 2022 as we work with our trading partners and investors to bring new and innovative capital markets solutions to the market, while at the same time seeing the benefit of diversifying, capital light fee income benefiting our earnings.”

Aspen Capital Markets specialises in constructing tailor-made portfolios of reinsurance for investors through managed insurance-linked securities (ILS) funds, as well as quota share sidecar structures which utilise the Peregrine Re vehicle.

The unit continues to expand its activities in specialty and casualty lines as well.

Aspen Capital Markets is one of the dedicated insurance-linked securities (ILS) fund managers and reinsurers offering ILS-style investment opportunities listed in our Insurance-Linked Securities Investment Managers & Funds Directory.