- Insurance required to cover potential losses on Albani house sales less than LTV (Albani Systemic Loss Scenarios)
- On an annual aggregate portfolio excess of loss basis.
- Cover restricted to n% DataSource valuations (AVMs) with deductibles.
- Premium on Drawdowns.
- Albani Specialist Indemnity Insurance Requirement
- Nick Griffiths and Harry Richardson, Inver Re (now part of https://www.priceforbesre.com/) contacted:
- https://limeriskagency.com/
Dave Harry: No capacity: Conditional on systemic risk (real live data) - https://active-re.com/
? - https://ion.co.cr/
No capacity - https://www.ocean-re.com/
No capacity - https://www.fortegra.com/
Irmantas Brazaitis: Management like concept and short tail (150day Churn Rate); Conditional on systemic risk (real live data)
- https://limeriskagency.com/
- AA contacted https://www.twentyci.co.uk/ summary of business plan:
- Albani Limited intends to provide open-bridge, non-recourse, non-status, interest-free finance to owners of selected houses in England and Wales. Makes sellers Proceedable Buyers. See: https://albani.finance/
- Albani finance (LTV) will be between 85% to 90% of DataSource valuations (AVMs) for each property. Houses (freehold, urban with 3 comps) valued at between £250K and £700K. See: https://albani.finance/application/
- If the homeowner takes the LTV Albani sells the homeowner’s house to recover its finance – say 150 days on market to completion of sale contracts (Churn Rate) at av. 96% LTV.
- Inver Re sourced US insurance company (not conversant with the UK residential market) to provide a policy STC to insure against Albani losses on house sales below LTV (on an annual aggregate portfolio excess of loss basis); effectively credit enhancement.
- Insurer needs real-live data to price potential systemic risk (fall in house prices below LTV).
- Albani required the following data:
- What is the current state of the UK property market?
- How will the current state of the UK property market affect Albani’s business plan (see above)?
- How is the current state of the UK property market susceptible to external shocks?
- What are the type of house price fall scenarios that constitute systemic risk?
- What will be the impact of systemic risk on our business plan when the homeowner has taken the LTV and we are selling their house to recover the LTV (150 day Churn Rate at 96% LTV) – will the sale be below LTV?
- What will be the impact of systemic risk on an Example Portfolio – to see how a real-life portfolio would perform.
- How likely is it that a property will be sold below it’s AVM value (our DataSource valuation) and how much below?
- How likely are property prices to drop by 20% (i.e., 10% below LTV) and if they did what percentage of houses and how far below?
- Twentyci Report: https://albani.finance/twentyci/
- Twentyci requires £12,000 fee to implement Report.
- Albani can either pay fee if funder requires or
- incorporate Guernsey SPV (Strategic Risk Solutions)
- produce AI data