Carey Olsen partner Christopher Anderson recently introduced the
concept of a hybrid vehicle for use in the insurance-linked
securities (ILS) industry. Here, he explains how and why he came up
with the idea of the world's first ILS hybrid.
As is often said, the best ideas are always the simplest. That
is reassuringly accurate for the introduction of the world's
first hybrid vehicle for use in the ILS sector.
The ability to utilise an all-in-one structure that can act as
both re/insurer and ILS fund has existed in Guernsey's
regulatory framework for some time, but the concept had never been
fleshed out in practice.
That, however, all changed at the beginning of April when the
Guernsey regulator, the Guernsey Financial Services Commission
(GFSC), confirmed that it was happy to receive applications from
mixed purpose protected cell companies containing both investment
and insurance cells. This enabled the creation of an ILS fund
hybrid, something no other
