Secured Re Trust
A fund for climate-aware accredited investors to capitalize weather derivatives and insurance linked securities using placements held in stocks.
Homes and buildings in desirable mountain, beach and countryside and destinations are subject to a confluence of financial pressures:
Increased appreciation of limited stock from zoom-town remote worker migration displaces housing for local construction labor, increases construction demand while restricting supply, and raises repair and replacement costs.
Fast-rising home values and replacement costs outpace insurance policies' ability to adjust. Strings of large climate-change related wildfire and flood claims has dampened carrier and reinsurer appetite for insuring these areas, resulting in a bump in under-insured, self-insured or uninsured properties.
Mission: Secured Resilience
Secured Re's mission is to provide financial instruments for property owners in the most beautiful, desirable and climate-risked areas on the planet to adapt to climate change and recover from catastrophic weather events.
Weather derivatives
These index-based instruments use observed weather data at a weather station to create an index on which a payout is based. They are bets against catastrophic weather events used by companies or individuals to hedge against the risk of weather-related losses.
The Canadian Derivatives Institute
Insurance-Linked Securities (ILS)
Securities whose value is affected by an insured loss event. If a triggering catastrophic event occurs, holders can lose most or all their principal and unpaid interest payments.
Margin Loan
Margin loans are personal loans that borrow against the securities in a portfolio. Typically, margin loans are tied to a variable rate structure and offer more flexibility and more favorable rates than other borrowing sources. With Secured Re Trust, the funds are used to purchase weather derivatives or insurance-linked securities.
The margin loan mechanic allows accredited investors with homes in high-climate-risk areas to hedge some or all of the replacement value of their and their communities' property using their stocks as collateral.
Margin Call
A margin call is usually an indicator that one or more of the securities held in the margin account has decreased in value. When a margin call occurs, the investor must choose to either deposit additional funds or marginable securities in the account or sell some of the assets held in their account.
Fund I: Wildfire
The latest satellite, tower and mobile sensor data and modern parametric models more accurately, regularly and granularly price wildfire risk and simplify payout.
Behavior-engineered mobile app self-reporting adverse selects good risks and streamlines both underwriting and claim processing, reducing operating costs. This product is served as insurance where cleared with insurance regulators, and is also available as a weather derivatives in all jurisdictions.
Tac Leung
Distributed ledgers increasing reliability and security, further reducing operating costs.
Margin loans from investor stock portfolios held by Secured Re Trust serve as capacity for the wildfire weather derivatives.
Wildfire weather derivative
Secured Re's parametric weather derivative uses realtime data from satellites and tower sensors to price the risk premiums and trigger the payouts.
For Accredited Investors
“Accredited investor” is a designation for individuals or entities that meet income, net worth, or licensure criteria, allowing them to access private market investment opportunities not available to retail investors.
To participate in Secured Re Trust, investor must meet one of the following requirements:
- Individual or joint net worth in excess of $1M (not including the value of a primary residence);
- Individual income in excess of $200k or joint income in excess of $300k for the two most recent years, with a reasonable expectation of reaching this level in the current year;
- Holding a Series 7, 62, or 65 license.
- Proof of ownership of a second home with listed value over $1M