Effective from May 7th, Swiss Re will take on a formal co-investment manager role for GAM’s ILS fund range, including the flagship GAM Star Cat Bond UCITS Fund.
Under the new arrangement, Swiss Re will be responsible for making investment and portfolio management decisions, while GAM will retain oversight of risk management and continue to lead on global distribution and product structuring. This development marks a significant shift in the management of the funds, with Fermat Capital Management stepping away from its long-standing role as investment manager of the GAM Star UCITS catastrophe bond fund strategy, and possibly other related GAM funds.
Fermat’s exit from the GAM partnership follows the successful launch and rapid growth of its own UCITS catastrophe bond fund in 2024. By the end of that year, Fermat’s new fund had exceeded US $750 million in assets under management (AUM), a figure that is expected to have grown further since. With this momentum, Fermat appears poised to operate independently in the UCITS space—a move that aligns with its strategic expansion and increasing investor demand.
The transition also comes on the heels of a turbulent period for GAM, which went through an ownership struggle in 2023 that temporarily impacted investor confidence and fund flows. That chapter has since closed, and the firm is now looking ahead with renewed strategic partnerships.
Swiss Re, already a heavyweight in the ILS space with approximately US $5 billion in ILS assets under management—including catastrophe bonds, private ILS funds, reinsurance sidecars, and bespoke structures—will gain an estimated US $3 billion in additional AUM through its co-management of GAM’s funds. The two companies have also signalled future collaboration on ILS innovation, suggesting new opportunities may be on the horizon.
Mariagiovanna Guatteri, CEO and CIO of SRILIAC, noted: “The ILS market set new records in 2024, and strong returns on cat bonds have highlighted the attractiveness and diversification value of the asset class for investors. It is an exciting time for the industry, and we see considerable interest both from cat bond issuers and investors.”
Christopher Minter, Head of Swiss Re Alternative Capital Partners, added: “We are delighted to partner with GAM to co-manage their cat bond and ILS investment strategies. We look forward to working with GAM to bring Swiss Re’s unparalleled risk knowledge and cat bond industry experience to investors.”
The move solidifies Swiss Re’s position as a leading force in the growing ILS market while marking a strategic evolution for GAM’s investment offerings.
