US wholesale giant CRC Group has launched an alternative capital-backed quota share property facility fronted by Liberty International Underwriters (LIU), The Insurance Insider can reveal.
According to sources, LIU will provide its AM Best A-rated paper to a follow-form facility dubbed QSP+, as well as putting up a share of its capacity.
A trio of unspecified alternative capital players will then fill out the facility with their capacity, in the latest move by insurance-linked securities funds to access primary property insurance risk.
According to marketing literature from CRC, the QSP+ facility will be used to add capacity to that already provided by a select group of core markets.
Sources have suggested the panel of core markets comprises 12 insurers, which will set the pricing, terms and conditions for the placement that the facility will follow.
The facility will offer up to $10mn, or 50 percent of primary limits on property placements.
It will also follow the panel with up to $25mn or 50 percent of excess limits.
Minimum premium has been set at $10,000, with maximum total insured value for placements fixed at $500mn.
The facility will cover US risks only and will exclude several classes including agricultural risks, builders' risk, chemical risks, dealers' open lot, energy and utilities, food processing, heavy manufacturing, mining risks, mobile homes, lumber risks, primary frame and recycling risks.
The marketing material said the facility had been put together to allow clients to "take advantage of the growing relevance and importance of alternative capital".
"CRC is excited to provide the ability for agents and insureds to access alternative capital to bring diversity to their insurance portfolios," it continued.
The move by CRC follows a number of initiatives by its larger rival Amwins to harness alternative capital for its property book of business.
In early 2015 Amwins teamed up with Nephila Capital on a follow-form underwriting facility to provide all-risk property capacity for business placed by the US wholesaler.
The 10 percent-line facility was fronted by Allianz, with terms set by the open market lead underwriters.
The facility ended earlier this year and was replaced by the Amwins Sidecar Facility, which is managed by its Special Risk Underwriters MGA with capacity from Munich Re.
Amwins maintained its relationship with Nephila, however, through its exclusive wholesale relationship with the Bermudian fund manager's Velocity Risk Underwriters MGA for commercial excess and surplus lines (E&S) property insurance.
Nephila also accesses US primary risk through relationships with a number of third party cat-focused MGAs, including AmRisc.
Although the identity of the alternative capital backing CRC's new facility has not been confirmed, several fund managers have been making efforts to follow Nephila's path to access primary insurance risk in the US.
Notably, Securis already has a US E&S property relationship with Novae Group's Lloyd's Special Purpose Syndicate 6129.