AlphaCat Managers is an investment management firm organized as a Bermuda exempted company
in July 2008. AlphaCat Managers specializes in providing investment advisory services in risk-
linked instruments that enable access to property catastrophe insurance and reinsurance-linked
assets and securities. Shares are offered exclusively on a private basis to a limited number of
sophisticated qualified institutional and high net worth clients.
AlphaCat Managers is wholly owned by Validus Ventures, Ltd., a Bermuda based company that is
wholly owned and controlled by Validus Holdings, Ltd. (“Validus”) a wholly owned subsidiary of
American International Group, Inc. (“AIG”). As of October 2021 the Chief Executive Officer of
AlphaCat Managers is Christopher Schaper.
AlphaCat Managers engages AlphaCat Capital as a non-discretionary sub-adviser to its Clients and
Funds. AlphaCat Capital is separately registered with the SEC and is based in Jersey City, New
Jersey, operating from offices shared with a financial affiliate, AIG. AlphaCat Managers provides
investment advisory services to AlphaCat Diversified Fund Ltd., AlphaCat Diversified Fund II,
Ltd., AlphaCat Advantage Fund Ltd., AlphaCat Prima Fund, Ltd., AlphaCat Opportunities Ltd.,
AlphaCat Opportunities II Ltd., AlphaCat 2015 Ltd., AlphaCat Soteria Fund Ltd., and AlphaCat
Master Fund Ltd. (collectively the “Funds” ) and separately managed accounts for institutional
investors (“Clients”) who have engaged AlphaCat Managers as an investment adviser or investment
manager. AlphaCat Managers also performs its advisory services under the name AlphaCat.
AlphaCat Managers sponsors the Funds as well as acting as the investment manager. AlphaCat
Managers also constructs portfolios involving traditional reinstateable reinsurance contracts and
collateralized reinsurance arrangements sourced through our licensed reinsurer. In addition,
AlphaCat Managers structures insurance related investments in other vehicles or accounts which
are not investment companies or “private funds,” as those terms are defined by the U.S. Securities
and Exchange Commission (“SEC”).
Each Fund is open for investment only by qualified institutional or high net worth investors that
meet the investor restrictions as set forth in the applicable Fund's subscription documents. The
shares of the Funds are offered only to: (i) Non-U.S. Persons who are “qualified participants,” as
defined in the Bermuda Investment Funds Act 2006 and (ii) U.S. Persons who are “qualified
purchasers,” as defined in the U.S. Investment Company Act of 1940 Act, as amended (the “U.S.
Company Act”), “accredited investors,” as defined in Regulation D under the U.S. Securities Act
of 1933, as amended, and “qualified participants,” as defined in the Bermuda Investment Funds Act
2006. At the time of this filing, none of the Funds have been sold to U.S. persons, therefore Form
D has not been filed with the SEC. The Funds will conduct trading activity pursuant to the
investment strategies described generally below. Funds may be organized and offered for private
investors generally or may be customized for single investors or groups of investors as agreed with
AlphaCat Managers.
AlphaCat Managers specializes in providing investment advisory services in property catastrophe
event-linked insurance and reinsurance risk exposures including, but not be limited to, the following
types of investments (together, “Risk-Linked Instruments”):
private collateralized reinsurance arrangements sourced in traditional property catastrophe
reinsurance markets, including reinstatement premium protection reinsurance contracts;
•
Catastrophe bonds (principal-at-risk variable rate notes and other event-linked securities)
being referred to collectively as “Cat Bonds”);
• Industry loss warranties (both indemnity-based and non-indemnity-based) binary
reinsurance or derivative contracts triggered by industry-wide insurance losses (referred to
collectively as “ILWs”);
•
Exchange or over-the counter traded event-linked futures or derivative contracts; and
•
Shares of special purpose reinsurers and other securities or instruments
the return on which
is linked to the occurrence of a predetermined event.
The Funds and Clients themselves do not carry out insurance or reinsurance business in or from
within Bermuda. All private collateralized reinsurance arrangements sourced in traditional property
catastrophe reinsurance markets, including reinstatement premium protection reinsurance contracts
business are entered into by AlphaCat Reinsurance Ltd., (“AlphaCat Re”) and OmegaCat
Reinsurance Ltd., (“OmegaCat Re”). AlphaCat Re was incorporated in January 2009, OmegaCat
Re was incorporated in November 2018. AlphaCat Re and OmegaCat Re are registered in Bermuda
as a Class 3 and Class 3A insurers respectively under the Bermuda Insurance Act 1978. AlphaCat
Re and OmegaCat Re enable the Funds and Clients to participate in risks linked to traditional, fully-
collateralized reinsurance contracts and indemnity-based ILW transactions through the issuance of
variable funding notes, where necessary. AlphaCat Re and OmegaCat Re do not issue interests in
themselves and are not private funds as defined by the SEC.
The Funds and Clients typically invest in Cat Bonds, non-indemnity based ILWs, event-linked
futures and derivatives through the Master Fund. The Master Fund was incorporated on July 23,
2008 as a Bermuda exempted, mutual fund company. The Master Fund operates as a special
purpose vehicle issuing variable funding notes in relation to specific investments. The Funds and
Clients may also, from time to time, invest directly in non-indemnity based Risk-Linked
Instruments, including Cat Bonds and direct investments in shares of special purpose reinsurers.
The respective Funds’ interests in Risk-Linked Instruments of AlphaCat Re and Master Fund are
documented through variable funding notes purchased from the respective vehicle which originated
the investment, subject to the investment guidelines for the applicable Fund. Some Funds and
investment vehicles may have the ability to purchase catastrophe bonds and non-indemnity based
contracts directly rather than through the Master Fund. The investments originated for all of the
Funds are selected and managed by AlphaCat Managers.
AlphaCat Managers generally invests collateral, unearned premiums and uninvested assets of a
portfolio in:
Money market funds rated AAAm or Aaa-mf and holding primarily national government
obligations;
Direct US Treasury obligations or direct obligations of an OECD member country rated at
least AA-/Aa3;
Cash held by a bank rated at least AA-/A3; and
•
Collateral pool guaranteed by a financial institution rated at least A-/A3.
AlphaCat Managers does not tailor its advisory services to the individual needs of Investors
(although AlphaCat Managers’ advisory services are tailored to meet the investment mandates of
the Funds, as described in the Funds’ Offering Documents). The Investors may not restrict
investments by the Funds in any capacity.
The Funds have entered into side letter agreements with certain Investors. Such agreements may
provide such Investors with additional notification and disclosure rights and special fee
arrangements (but not preferential liquidity terms), among others. The Funds generally enter into
side letters only with Investors who make substantial commitments of capital.
AlphaCat Managers does not participate in wrap fee programs.
AlphaCat Managers managed approximately $ 3,438,020,483 in Regulatory Assets Under
Management (“RAUM”), calculated as of January 1, 2023. RAUM is a defined term of the SEC
that reflects cash and securities managed for clients as well as all assets of a “private fund” as the
SEC defines that term, on a leveraged or gross basis as reflected on the gross asset value line of the
balance sheet of the Funds, including committed uncalled capital. After including the proceeds
from structured notes in issue and assets managed in reinsurance sidecars, AlphaCat Managers net
assets under management calculated as at January 1, 2023 is approximately $ 3,277,568,266.
AlphaCat Managers also provides advice on structuring various insurance portfolios, which fall
outside of the RAUM definition.