CCR Re’s Montador welcomes investors’ robust questions on French-domiciled sidecar 157 Re

Investors that ask questions about CCR Re’s 157 Re, a sidecar vehicle launched in March this year, are cherished as this approach builds trust and ensures a robust solution, according to Laurent Montador, deputy chief executive officer at CCR Re.

He told Baden-Baden Today that business at the French-domiciled sidecar, the first to be set up in France, is going well “using the French regulation”. He explained that being set up under French regulations means that CCR Re and the investors do not have to put a company in place, as such.

“The burden of hard work in creating a company for a special purpose vehicle (SPV) is often time and asset-consuming. The French regulation had the possibility to make it work in an easier manner,” Montador said.

He explained that CCR Re presents the sidecar opportunity to investors in a very straightforward way.

“You have to attract investors and deliver the potential upside with some possible downsides. It is a good exercise to explain to investors how we run the business and its limits.

“We have been very clear on the limits we have in the model and the uncertainties it uses, not just for one year but for the longer term.

“We want to have investors that really understand how we do it and how it works. They have asked lots of questions to understand, and we like this attitude because it is better for the robustness of the solution that can be provided,” he said.

By being open about the SPV, Montador said, the reinsurer builds trust with investors as well as avoiding any suggestions of mis-selling.

“This is very important for the continuity of the business,” he added.

Looking ahead, Montador said the sidecar will continue to develop broadly in the same direction in 2020 as it did in 2019.

“Events in 2019 have been within the scope of the sidecar but nevertheless there has been loss activity in 2019, especially with Typhoon Hagibis in October, which has had an impact.

“We are quite robust in what we said and what we have as an impact, so it is under control,” he concluded.