Online lotto betting operator Lottoland have announced a third two-year long-term agreement for their Insurance Linked Security (“ILS”) jackpot insurance (“Fortuna 3”). The new insurance deal provides € 120 million, of ILS coverage alone – €20 million more than the previous transaction. It is a cornerstone of Lottoland’s advanced risk management system which is now providing total cover in the hundreds of millions and over 50% more than last year.
The two previous deals (“Fortuna 1 and Fortuna 2”), which triggered a renewal option after one year due to Lottoland’s strong growth respectively were completed in April 2015 and June 2016, providing Lottoland with a lottery winning risk collateralized reinsurance transaction – the first ILS to be domiciled in Gibraltar. This third, two year, transaction – Fortuna 3, again fully collateralized through cash trust accounts and letters of credit, is the largest ever reinsurance transaction in the Gambling industry. All previous investors have shown their confidence in Lottoland by participating in the new transaction, and new leading investors have come on-board.
Lottoland’s risk management structure has already proven its reliability, covering a number of major winnings. The largest win paid out by Lottoland’s ILS so far was €22 million and was won by a player from Berlin in 2016. So far, Lottoland has returned over €838 million in total winnings across its business portfolio. Fortuna 3 provides Lottoland with even more flexibility to innovate and offer new games to players.
Other operators form sports-betting and casino can also benefit from Lottoland’s proven lottery insurance solution thanks to Lottoland’s B2B arm Lottoland Solutions and add lottery bets to their product portfolio. Lottoland Solutions guarantees all winnings pay outs with their collateralized jackpot insurance and offers a lottery betting interface that is easy to integrate into existing websites. Customers of William Hill Australia, Kindred Group plc and Gaming Innovation Group plc, are already benefitting from a partnership with Lottoland Solutions.
Lottoland CEO, Nigel Birrell, said, “Our innovative approach to this market is really paying off. The ILS provides a fully reliable way to reinsure against big wins and we’re delighted to have this second two year agreement in place which we have taken to the next level – the only solution in the industry which has proven fast and reliable pay-out of winnings.”
Gibraltar’s Minster for Commerce, Albert Isola MP, also commented on the Lottoland transaction saying “Let me congratulate Lottoland and its investors for leading the way with the launch of their third successive ILS transaction. Their success to date and their future plans for innovative ILS structures that will be offered to other participants in the gaming community are very exciting.
The investors’ confidence in both the Lottoland transactions and Gibraltar as the domicile of choice is very gratifying.”