AXIS Capital continues to leverage alternative capital and partner with insurance-linked securities (ILS) investors, with these activities generating attractive fee income in 2025. While a new structure established for 2026 shows that its casualty sidecar Monarch Point Re remains a core focus for the company.
In 2025, it seems AXIS Capital had a profitable year, generating attractive fee income from its partnerships with ILS investors, which suggests those activities will also have delivered attractive returns to those providing the third-party capital.
During AXIS’ fourth-quarter earnings call recently, CFO Peter Vogt commented, “I would also note that underwriting fees from ILS partners were $14 million in the quarter and $54 million for the year and represent an attractive stream of fee-like earnings delivered from our ILS partners.”
That was the extent of the disclosure, but it shows that third-party capital activities continue to drive an additional earnings stream for AXIS Capital, albeit seemingly lower than the disclosed fees from its capital partner relationship activities in 2024, which amounted to $85 million for that year.
It’s important to stress that AXIS has repeatedly changed the reporting around these figures and so there is now way to know if the ILS partner fees encompasses all the fees the re/insurer used to report as from its strategic capital partnership activities.
In its full-year 2025 results, AXIS Capital did disclose that its cession rates to strategic capital partners remain higher, indicating more risk being backed by third-party capital through these activities.
Part of the increased cessions of premiums to investors in recent years has been through AXIS’ casualty sidecar type structure, Monarch Point Re.
AXIS Capital partnered with sector focused investor Stone Point to launch Monarch Point Re in 2023, after a more than $400 million capital raise.
The Monarch Point Re vehicle operates as a kind of third-party capitalised casualty reinsurance sidecar structure, with a total return approach.
Each year since its launch, AXIS has registered a new collateralized insurer class of company in Bermuda, to act as an underwriting structure to support Monarch Point Re, the last time being in early 2025.
For 2026, another collateralized insurer has been registered in Bermuda, this time called Monarch Point Re (ISA 2026) Ltd., which will become the latest structure established to support the AXIS casualty sidecar-like operation.
Monarch Point Re operates out of Bermuda and underwrites a diversified portfolio of casualty reinsurance business, which is retroceded to it by subsidiaries of AXIS Capital through quota share arrangements.
Stone Point Credit plays the role of exclusive investment manager to Monarch Point Re, allocating the sidecar’s capital to a diversified portfolio of corporate credit resulting in a total-return approach, leveraging the longer-tailed casualty ILS nature of the subject business risks to allow for a more flexible investment strategy.
We assume a reasonable proportion of the fee income reported by AXIS’ CFO Vogt comes via the Monarch Point Re strategy. But aside from that, AXIS Capital also remains active in sharing other risks and portfolios with third-party capital providers.
In fact, CEO Vince Tizzio highlighted early progress with relatively recently launched AXIS Capacity Solutions as one example of third-party capital activity during the earnings call recently.
Tizzio said that, “We’re pleased by the early progress of AXIS Capacity Solutions, otherwise known as ACS. Through ACS, we are tapping into our deep knowledge and experience with third-party capital, bringing innovation to the insurance platform of our company, serving both our open brokerage and delegated businesses.
“This includes leveraging our underwriting and portfolio management expertise to work in tandem with our strategic partners to develop structured portfolios at scale while producing new business and underwriting fee income as a new stream to AXIS.
“While it is early days, several transactions have already been completed.”
He also said that ACS is, “addressing unique needs from our customers and utilising third-party capital,” during the call.
AXIS continues to put its underwriting expertise and access to risk to work alongside third-party capital partners, which effectively allows the business to increase its scale and relevance in the market with the support of investors, manage risk and capital, earn fee income and also capitalise on opportunities it may not always want to retain the entirety of on its own balance-sheet but that investors have an appetite for.
