Ferian Re has committed long-term capacity to Coalition’s cyber insurance programmes. Credit: Pete Linforth from Pixabay.

Cyber insurance provider Coalition has formed a new independent Bermuda-based Class 3B reinsurance firm, called Ferian Re.

Ferian Re has been formed to provide capacity across Coalition’s cyber programmes.

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The new entity will secure $300m from a consortium of investors led by BDT Capital Partners, an affiliate of BDT & Company.

Minority investors such as the Pritzker Organization and other global investors will also be investing in the reinsurer.

Ferian Re will be participating in Coalition’s cyber insurance programmes alongside insurers and reinsurers, such as Allianz Group, Arch Insurance North America, and Swiss Re Corporate Solutions.

Coalition founder and CEO Joshua Motta said: “The rapid growth of the cyber insurance industry has outpaced the supply of reinsurance capital. We are excited for Ferian Re to bring alternative capital to the market and introduce a reinsurer with deep expertise in cyber.

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“Our partnership with BDT Capital Partners and other strategic, long-term investors will help address this supply and demand imbalance and support our long-term growth ambitions.”

BDT Capital Partners president and co-chief investment officer Dan Jester said: “Coalition has pioneered a new model of risk management with Active Insurance, which has resulted in continued strong performance and market-leading loss ratios.

“With the formation of Ferian Re, we are excited to provide a tailor-made capital solution to support Coalition as it scales to be one of the largest cyber insurance providers globally. This investment reflects BDT’s differentiated focus on providing patient capital to family- and founder-led companies to support their long-term success.”

Recently, the US-based cyber insurance company acquired Digital Affect Insurance Company from Munich Re.