New vehicle may write for two years
New Point IV, the new sidecar set up by Bermudan (re)insurer Alterra, will start writing on 1 May.
Alterra Agency Limited, an Alterra subsidiary, will be the underwriting manager for New Point IV and has entered an underwriting services agreement with the sidecar that will run from 30 April 2011 to 30 April 2012. Alterra said the agreement may be extended for another year, subject to certain conditions.
Under the underwriting services agreement, Alterra Agency will receive a service fee of 4% of gross written premiums, a performance fee equal to 8.33% of the cumulative adjusted net income relating to the business it writes for the sidecar and an administrative fee of up to $50,000 a quarter.
Alterra announced the formation of New Point IV, which will be capitalised at $200m, yesterday.