Coalition launches reinsurance vehicle with backing led by Aspen capacity

Coalition has secured capacity from Aspen to launch Coalition Re, a new vehicle that will offer non-proportional cyber treaty coverage as well as a white-label cyber product with up to 100 percent quota share support, Cyber Risk Insurer can reveal.

Both the non-proportional treaty coverage and white-label cyber product will be available globally and supported by a robust panel of capacity providers led by Aspen.

The white-label product effectively gives Coalition Re’s cedants the ability to offer cyber insurance as an endorsement to an existing insurance product offering.

Coalition Re builds a bottom-up view that it argues prices non-proportional reinsurance contracts accurately, as well as giving primary cedants the ability to learn more about their cyber insurance policyholders and gain visibility into key sources of risk within their portfolios.

The white-label product offered by Coalition Re includes the full suite of risk mitigation tools and services currently available only for Coalition’s standalone “active cyber insurance” policyholders.

“Democratising industry-leading technology”

Coalition says that active insurance helps underlying policyholders before, during and after an incident, unlike existing policies that do not provide cyber risk mitigation and response.

A spokesperson for Coalition confirmed the launch in a statement to Cyber Risk Insurer.

“In reinsurance, there is often a breakdown of information where reinsurers know less about policyholders than the primary insurers,” said Shawn Ram, Coalition’s head of insurance.

“Combine that with a lack of cyber expertise and proper data usage among reinsurers, and the result is inaccurately priced reinsurance contracts and a misconception around how to measure cyber accumulation exposure,” he added.

Ram described Coalition Re as “a new type of reinsurance provider whereby we equip carriers with deeper insights into the cyber risk in their books, which adds value far beyond simply adding capacity”.

“By democratising Coalition’s industry-leading technology, we can better align interests with cedants and promote a more stable cyber reinsurance market,” Ram explained.

Ram said that unlike other reinsurers, Coalition does not rely on historical or third-party data.

“We have built a robust and innovative approach to cyber reinsurance underwriting, leveraging continuous, internet-wide data collection, AI-enabled threat detection, and real-world security and insurance expertise,” he said.

“This allowed us to build the reinsurance industry’s most comprehensive picture of the cyber risk landscape and will set Coalition Re apart from other reinsurers.”

Bobby Bianconi, global head of cyber at Aspen, also commented on the tie-up, saying that the carrier is “thrilled” to partner with Coalition and that the “innovative reinsurance offering” will bring “clarity to the increasingly complex and critical risk of cyber”.

“We see a significant opportunity for this new capacity and the unique cyber risk insights that will complement the offer, with Coalition well-positioned to deliver these value-add services to cedants,” Bianconi added.

“We look forward to the continued work we will do with Coalition to bring market-leading cyber coverage to clients,” he concluded.

The Insurer broke the news a year ago that the cyber insurtech had been in talks to secure capacity for a new cyber reinsurance MGA to write unaffiliated, third-party treaty business.