Allianz's Pimco unveils new P&C ILS business under Pagnani

Pimco, the US-based asset management subsidiary of insurer Allianz, has launched a new property and casualty insurance-linked securities (ILS) business.

The company hired Mt. Logan Re CEO Rick Pagnani earlier in Jan to lead the new unit. Pagnani left Everest Re Group's specialist reinsurer Mt. Logan Re in May 2018 after leading the Bermuda-based company for five years.

Pimco said the ILS market is a strategically important asset class for its broader alternatives platform which has more than $34 billion of assets under management.

Pimco will work in partnership with its parent company Allianz to source global catastrophe risk in the form of collateralised reinsurance and other structured investments, while maintaining independent underwriting and portfolio construction procedures. It added that this differentiated approach will enable it to source risk from the open market to deliver attractive risk-adjusted returns for clients.

Allianz Group’s corporate insurance carrier Allianz Global Corporate & Specialty and reinsurance subsidiary Allianz Re will support the Pimco ILS business through access to its international underwriting network and the deal structuring capabilities of its capital solutions team.

“We are excited to enter the insurance-linked securities market at a time when volatility has become a mainstay of financial markets and clients want to diversify their investments,” said Emmanuel Roman, Pimco's chief executive officer. “Partnering with Allianz will give PIMCO access to a diversified portfolio of global catastrophe risk and the ability to leverage the robust capabilities of a premier global insurance group in our effort to deliver attractive risk-adjusted returns for clients.”

Amer Ahmed, CEO of Allianz Re, added: “We believe that this partnership of PIMCO and Allianz truly leverages the strengths of both companies. With PIMCO we have a partner with access to an investor base that can provide the capital for which Allianz can supply insurance risks, both traditional catastrophe exposure risks and over time other risk classes. At Allianz we are excited that this will enable us to expand our underwriting capacity and generate new fee-based income streams.”

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