The Hanover, Chaucer Form Reinsurance Sidecar to Tap 3rd Party Capital

December 22, 2017

The Hanover Insurance Group Inc. announced that Chaucer, the company’s international specialty insurance group, has sponsored the formation of a reinsurance sidecar to provide collateralized capacity for Chaucer Syndicate 1084’s global property reinsurance portfolio in 2018.

Bermuda-based Thopas Re Ltd., a newly formed segregated account company, will lead the transaction, which includes $95 million of third-party investor capital. Thopas Re has entered into an exclusive quota share agreement with Chaucer to reinsure a share of Chaucer’s U.S. and international property catastrophe portfolio, beginning Jan. 1, 2018.

“The creation of a reinsurance sidecar provides Chaucer and The Hanover with another means of leveraging our strong underwriting capabilities, and is a first step in creating new relationships with capital market partners,” said Jeffrey Farber, executive vice president and chief financial officer at Worcester, Mass.-based The Hanover

“This is a key development in the evolution of our business,” said John Fowle, chief executive officer at Chaucer, “providing us with greater scope and flexibility to support the evolving needs of our clients.”

TigerRisk Capital Markets & Advisory acted as sole structuring and placement agent on the transaction. Mayer Brown LLP and Appleby (Bermuda) Ltd. provided legal counsel.

Source: The Hanover Insurance Group Inc.

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