Tangency Capital grew assets 130%+ to $1.4bn, returns neared 40% in 2023

Tangency Capital Ltd., an insurance-linked securities (ILS) investment fund manager with a strategy focused on allocating capital to quota share reinsurance business, experienced strong growth in 2023, starting the new year with roughly $1.4 billion of assets under management.

That equates to growth of more than 130%, as Tangency Capital’s AUM had been sitting somewhere just north of $600 million at the end of 2022.

But it’s not just a capital raise story, Tangency’s quota share-focused ILS investment strategies have also delivered stellar returns in 2023, we’ve learned from sources.

We understand from sources that Tangency’s different reinsurance investment strategies have delivered strong returns last year, with funds returning from around 20%, to as much as just under 40%, to their investors for full-year 2023.

The investment manager has found clients with a liking for the aligned approach of allocating their capital to quota share reinsurance arrangements, where they effectively sit alongside much larger companies and share in their underwriting profits, as well as any losses they might experience.

Michael Jedraszak, Chief Investment Officer at Tangency Capital, told us, “We are pleased with the continued growth of our strategies and relationships with our investors and cedents.”

In the past we’ve learned that Tangency Capital has built a name in differentiating itself as a quota share reinsurance focused investment manager, focusing on its alignment with trading partners, diversification across quota shares and cedents, while bringing capital efficiency into its structures.

In the last year we’re told the company has had success in attracting new institutional investors, while also growing its relationships with long-standing ones.

One of the strong-points of the quota share market is the ability to be scalable, hence growth at this pace and deploying the capital is achievable in that market, perhaps more so than in say the cat bond market where the pipeline can restrict the ability to grow at pace.

Jedraszak of Tangency hopes that the success achieved in 2023 can continue and believes the ILS market has an elevated profile at the moment.

“It appears that the asset class is getting more attention at the moment which may lead to growth of the ILS industry over the coming years – we hope to participate in this growth,” he told us.

Tangency Capital is listed in our directory of insurance-linked securities (ILS) fund managers.

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