Cohen's SAC starts in reinsurance business
BOSTON (Reuters) - Billionaire hedge fund manager Steven A. Cohen is now officially in the insurance business.
SAC Re Ltd, the new reinsurance unit of Cohen's $14 billion SAC Capital Advisors, officially began operations on Monday, the group said in a statement.
The Bermuda-based unit, which will be run by Simon Burton, has $500 million in capital and plans to target a mix of high-margin property catastrophe and low-severity casualty reinsurance.
The new unit snagged an A- (Excellent) rating from insurance industry ratings group A.M. Best and has a stable outlook.
Cohen, who is known in the $2 trillion hedge fund industry for delivering double-digit returns over decades, is one of a number of hedge fund managers who recently branched into underwriting risk. His plans were first disclosed by Reuters in October.
Hedge fund managers David Einhorn, Daniel Loeb and John Paulson are all active in the reinsurance industry.
This year Cohen is again beating the average hedge fund, having recently told investors that his flagship fund has gained 5.2 percent since the start of the year. But Cohen's returns have also put his firm in the spotlight as the U.S. government investigates whether SAC's winning bets may have been aided by insider information.
Neither Cohen nor his firm have been accused of any wrongdoing. (Editing by Leslie Adler)
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