Archive for February, 2016

PKA Ltd. (Pensionskassernes Administration A/S), a large pension fund investment service provider for employee pension funds in Denmark, has highlighted the stability and return possible from ILS investments, achieving 15.7% from its allocation in 2015.

A continuation of insurance and reinsurance market pressures are expected to further diminish the underwriting profitability of Bermudian re/insurers during 2016, and with organic growth hard to come by Fitch Ratings predicts a surge in merger and acquisition (M&A) activity on the island.

A recent academic research paper has highlighted the benefits of utilising catastrophe bonds alongside traditional reinsurance to optimise firms’ catastrophe insurance programmes, creating efficient protection that expands underwriting capacity and provides greater value to shareholders.

Specialist global insurance and reinsurance group Hiscox expects assets under management at its insurance-linked securities (ILS) fund and reinsurance linked investment strategies unit Kiskadee Investment Managers will pass $1 billion in 2016.

There are four commandments that any company operating in the insurance and reinsurance industry should follow, according to Berkshire Hathaway’s Sage of Omaha Warren Buffett, and interestingly they reflect the discipline of the ILS market.

Here are the ten most popular news articles, week ending 28th February 2016, covering catastrophe bonds, ILS, reinsurance capital and related risk transfer topics. To ensure you never miss a thing subscribe to the weekly Artemis email newsletter updates.

The pricing guidance for the lowest risk of the three tranches of notes being issued through the Manatee Re Ltd. (Series 2016-1) catastrophe bond deal has been revised upwards according to sources, as investors again show a minimum return expectation for catastrophe risks.

Global reinsurers continue to note reduced returns across the majority of new business with competition levels intensifying, says A.M. Best. Emphasising the need for practicing disciplined reinsurance underwriting to mitigate margin erosion.

A report from rating agency Standard & Poor’s highlight the benefits diversification can bring to a reinsurance or insurance business model, but only so long as the company is diversifying for the right reasons, which raises questions given the current soft and challenging market.

Insurance, reinsurance and risk-linked securities (ILS or IRLS) are an “example of an innovative solution which allows the capital markets to provide an efficient and growing means to transfer risk,” according to SIFMA EVP Randy Snook.