Bain Capital Insurance has announced a capital investment in 1970 Group, a New York-based specialized risk financing provider to the insurance industry.
1970 Group offers expertise in structured financing, credit support and risk management. The company pioneered the concept of Insurance Collateral Funding (ICF), which enables companies to transfer their insurance collateral requirements off their balance sheets, giving them more capital to deploy to business operations and investment opportunities.
Financial terms of the Bain Capital investment were not disclosed.
1970 Group’s insurance, investment, and legal experts work with insurance buyers and risk managers, insurance brokers, carriers, and banks to deliver risk financing and risk management services to their companies ad clients.
The company says ICF was created to help companies utilizing loss sensitive workers’ compensation, general liability, commercial auto, and medical professional liability insurance programs deal with collateral requirements that can impair balance sheets The company provides an alternative to holding cash in escrow or signing letters of credit with banks; both of which it says can significantly reduce the amount of working capital available to a company.
“The opportunity for businesses can be enormous, as collateral requirements can often tie up a significant percentage of a company’s available financing lines,” the firm states on its website.
Bain Capital Insurance is the dedicated insurance investing business of Bain Capital, a global private investment firm with approximately $185 billion under management.
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