Best of Artemis, week ending 28th September 2014

Here are the ten most popular news articles, week ending 28th September 2014, on catastrophe bonds, reinsurance capital and related risk transfer topics, from the last seven days on Artemis. To ensure you never miss a thing  subscribe to the weekly Artemis email newsletter updates.

Top ten most viewed articles on Artemis.bm, week ending 28th September 2014:

1. Climate change catastrophe bonds for Africa to be launched by ARC
   Catastrophe bonds as a tool for financing the risk of climate change is set to become reality as the African Risk Capacity (ARC) announces the launch of the Extreme Climate Facility (XCF), a multi-year funding mechanism that will issue climate change cat bonds.

2. Nephila Capital provides capacity for Black Oak wind farm hedge
   Nephila Capital, the largest asset manager providing investments in natural catastrophe and weather risk, has provided the risk transfer capacity for a wind variability hedge for a project aiming to be New York State’s first community owned wind farm.

3. Reinsurers face potentially permanent erosion of profit margins: Fitch
   Ratings agency Fitch Ratings warns that the reinsurers face a ‘potentially permanent erosion of profit margins for reinsurance products‘ due to the impact of alternative capital and insurance-linked securities (ILS) on their core business.

4. Swiss Re pledges $10bn in re/insurance capacity for climate risks
   Swiss Re, one of the world’s largest insurance and reinsurance firms, has made a pledge at the UN Climate Summit in New York to make $10 billion of its capacity available, as well as offering its expertise, to help nations strengthen their climate resilience.

5. Pension funds still attracted to ILS investments, as new mandate shows
   There has been a lot of discussion lately about whether pension funds would be among the first investors to lose their attraction to the current market environment of lower reinsurance and catastrophe bond pricing by turning heel and exiting the sector.

6. Despite Monte Carlo reinsurance fillip, risk of disappointment remains
   For reinsurers the Monte Carlo reinsurance Rendez-vous has provided a fillip, defined as a stimulus to activity, but this is likely to be shortlived say analysts at Keefe, Bruyette & Woods, who say that the risk of disappointment looms large over the sector.

7. Blue Danube II cat bond technically (but v. remotely) exposed to Odile
   The focus of the catastrophe bond market’s exposure to hurricane Odile has been on the MultiCat Mexico 2012 deal, which is clearly at risk of loss as we’ve explained, but there are actually two other cat bonds with Mexican hurricane exposure.

8. Global reinsurance (and ILS) capital strengthens disaster risk resilience
   According to a new report, global reinsurance capital plays a key role in absorbing the impact of disasters, by providing predictable financial relief and strengthening societal resilience. We would add that ILS capital and catastrophe bonds do the same.

9. In tiered reinsurance market, expect desperate actions by some
   In a tiered reinsurance market, where large, globally diverse players occupy the top rung and more marginalised, smaller players are relegated, reinsurers should expect more desperate actions as lower tier reinsurers fight to maintain market share.

10. BOE’s Carney warns on low rates driving capital into reinsurance
    The Governor of the Bank of England Mark Carney has spoken out on capital inflows into reinsurance, saying that a ‘soft cycle’ in the financial markets (referring to interest rates) is driving capital into reinsurance and causing a soft cycle there.

This is by no means every article published on Artemis during the last week, just the most popular, some of which were published over a week ago. There were 20 new articles published in the last week. To ensure you always stay up to date with Artemis and never miss a story subscribe to our weekly email newsletter which is delivered every Wednesday.

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Q2 2014 Catastrophe Bond & ILS Market Report – The Biggest Quarter, The Biggest Catastrophe Bond

We’ve now published our Q2 2014 catastrophe bond & ILS market report.

This report reviews the catastrophe bond and insurance-linked securities (ILS) market at the end of the record second-quarter of 2014, looking at the new risk capital issued and the composition of the transactions completed during Q1 2014.
Download your copy here.