Concert’s new sidecar Harmony Re being positioned to take on third-party funds

Concert Group’s newly launched reinsurance sidecar Harmony Re will be positioned to secure additional capital support from third parties, although the fronting carrier itself has put the initial funding into the platform to get it off the ground.

The launch of Harmony Re as a fully owned sidecar was announced late last month by fronting specialist Concert.

Precise details on Harmony Re’s purpose, how it was capitalized and in what way it would operate were not provided, however.

But in a statement to this publication, Concert said it has capitalized Harmony Re in the first instance, although it intends to open the vehicle up to other investors.

“Our plans are to position Harmony Re to secure third-party capital,” the company said.

When Harmony Re was unveiled in September, Concert chief underwriting officer Joe Alberti explained that the new reinsurance sidecar provides the fronting carrier with a “second line of defense on portfolio and risk management, as well as additional flexibility in meeting the market’s needs”.

“Harmony Re is the group’s balance sheet entity that assumes risk from Concert’s carriers and generates insurance profits with a keen focus on portfolio diversification, risk and capital management,” Alberti explained.

As Concert explained to The Insurer, Harmony Re’s purpose is to reinsure the applicable net retentions of the group’s statutory companies.

Those companies are Illinois-domiciled admitted carrier Concert Insurance Company (CIC) and Montana-based surplus lines platform Concert Specialty Insurance Company (CSIC). Both CIC and CSIC are rated A- by AM Best.

Harmony Re will reinsure that business through a quota share agreement, alongside other structures, “to provide balance sheet capacity in support of a diversified portfolio of property and casualty business, in partnership with reinsurance brokers and capacity partners and underwritten by Concert's seasoned professionals”.

Those seasoned professionals include Alberti, senior vice president of property underwriting and program management Charles Rawlins – who joined in July from Brace Insurance Services – and senior vice president of underwriting and program management Doug Kovach.

Katarina Scamborova has also joined the company to lead Harmony Re as president.

When announcing Harmony Re’s launch, Concert said Scamborova had been instrumental in establishing the new sidecar alongside Alberti.

Scamborova was most recently head of standard propositions for North America at Swiss Re Corporate Solutions. She previously spent seven years at AIG as a senior executive in its general insurance business and two years as P&C industry leader at McKinsey & Company.

She will report to Concert CEO John Hendrickson.

Concert was launched in 2021 initially with backing from individual founders including Strategic Risk Solutions CEO Brady Young as well as Century Equity Partners and WT Holdings. To date, its book has predominantly been focused on medium and long-tail lines of casualty business written on a surplus-lines basis.

Harmony Re’s launch forms part of Concert’s bid to grow its book of business, which is understood to currently amount to some $300mn of premium.

That expansion drive was part of the rationale behind the hire of Rawlins, with the recruit’s primary focus being on growing a profitable book of property business at the fronting carrier.