Imagine there’s a way for institutional investors to trade insurance risks much like they trade stocks. Well, imagine no more. A new and unique reinsurer, Extraordinary Re, has hit upon the novel idea of creating a trading platform run by Nasdaq for investors to trade assets tied to insurance liabilities.Executive SummaryExtraordinary Re’s trading platform, which is heading toward a 2018 launch, intends to unlock more than $20 trillion of existing liabilities held on insurance company balance sheets while enabling institutional investors to access an attractive return from an uncorrelated asset class.
The Extraordinary Re platform, which will be launched this year, offers the opportunity for investors to diversify their portfolios outside traditional stocks and fixed-income assets with a new investment class that does not correlate with the risks of other investments. For insurers and reinsurers, the platform presents an innovative way to access the capital markets to buy reinsurance capacity to absorb a wide range of risks.