2114 3291 Corinthian Pitch Book Design Revision Digital - Flipbook - Page 5
HOW IT WORKS
PROGRAM EXAMPLE
THE DRIVING PRINCIPLE BEHIND THE INVESTMENT OPPORTUNITY IS DEFINED BY ITS
ULTIMATE GOAL; YOUR MONEY SHOULD BE WORKING OVERTIME FOR YOU, 24/7.
CORINTHIAN RE 10% QUOTA SHARE PARTICIPATION
NUMERICAL DEPICTION
$10,000,000 Gross Written Premium
EXAMPLE A
(Typically a large group of
underlying policy holders)
20% Program Costs
$8,000,000 Net to be Ceded
EXISTING INVESTMENT
PORTFOLIO
LETTER OF CREDIT
(LOC)
$800,000 Net Premium to Corinthian Re
$80,000 Direct to Unrestricted Cash
LIBERTY MUTUAL
(A or better rated carrier)
$10MM GWP
$720,000 Direct to Trust / Claims Fund
Schedule F = $750k + 10% = $825k
$1 million existing investment remains
untouched as support for a letter of credit.
LOC has low risk of being called. If it ever is,
it instantaneously becomes a loan.
Schedule F ($825k) – Trust ($720k) = $105k
The return on the LOC is 7%*
Letter of credit issued for $105k to
fund gap between trust assets and
schedule F requirement
YOU’VE ADDED A 7% INVESTMENT TO YOUR EXISTING PORTFOLIO WITH MINIMAL, NON-CORRELATED RISK.
Liberty Mutual
(Captive)
20% or $2MM
Quota Share
Facility
to be Ceded
80% or $8MM
Corinthian Re
– Segregated
Cell 10% = $1MM
GWP or $800k net
Other Unrelated
Reinsurers
70% = $7MM GWP
or $4.9MM net
Unrestricted
Cash
10% of net or
$80k
Reinsurance Trust
/ Claims Fund
90% of net or
$720k
*Letter of credit advance rate will vary.
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