Best of Artemis, week ending 27th March 2016

Here are the ten most popular news articles, week ending 27th March 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.

Top ten most viewed articles on Artemis.bm, week ending 27th March 2016:

1. Swiss Re ready to disrupt the risk to reinsurance capital value-chain
   Global reinsurance player Swiss Re has released its own measure of earnings performance today, reporting lower Economic Value Management (EVM) income and profit in 2015. But, perhaps more interestingly, the firm also noted its willingness to disrupt and bypass traditional channels to access risk.

2. Credit Suisse targets April for Operational Re ILS, splits to two tranches
   The CHF630m operational risk insurance linked catastrophe bond or ILS structure Operational Re Ltd. is still being marketed by global investment banking group Credit Suisse, with April now being targeted for completion and the structure split into junior and senior tranches.

3. Reinsurers creep closer to breakeven on a normalised basis: Fitch
   Reinsurance firms are operating very close to breakeven, on a normalised basis, reflecting the “wider deterioration in market conditions, driven by lower reinsurance prices feeding through to results,” according to Fitch Ratings.

4. Brussels attacks to demonstrate lack of insurance cover for terror risks
   The tragic events in Brussels, Belgium this week, when more than 30 people were killed by terrorist bombings at the city’s airport and metro, are unlikely to result in significant insurance or reinsurance impact, but demonstrate the lack of coverage for the terrorism-related economic exposure.

5. Lloyd’s continues to loosen up to alternative capital & ILS
   Another year passes, another annual report from the Lloyd’s of London insurance and reinsurance market is released and we witness another increase in the positive tone in which the market describes the opportunity to embrace ILS and alternative capital.

6. Solvency II reinsurance regulatory arbitrage. Good for ILS?
   According to Fitch Ratings there may be a reinsurance regulatory arbitrage available that could benefit U.S. reinsurers, as cedants in Europe look to offload more of their risks, due to higher capital requirements under Solvency II, while reinsurers outside of the S2 framework could have an advantage.

7. CEA reinsurance program nears $4.5bn, but cat bonds hard to justify
   The California Earthquake Authority (CEA) is set to increase the size of its reinsurance program with an April placement set to take its total risk transfer to $4.5 billion, but ILS investors have not seen a new catastrophe bond as currently they are hard to justify due to the cost.

8. Reinsurance a rising priority, as cedant buying habits evolve: Willis Re
   As more primary insurers utilise a formal risk appetite statement their reinsurance buying habits have evolved, says Willis Re. And with reinsurance becoming a greater priority for many firms there could be an opportunity for insurance-linked securities (ILS) capacity to expand its global footprint.

9. Brokers pressured, but alternative capital (& insurtech) are opportunities
   Brokers face increasing pressures, with revenue and profitability likely to continue to be impacted due to the softening reinsurance market environment, but one bright spot could be the growing alternative markets according to rating agency Fitch, while another could be technology.

10. To enter emerging markets ILS needs to educate: Simon Young, ARC
    In order for the insurance-linked securities (ILS) product to have a meaningful influence on emerging markets Simon Young, of ARC Insurance Company, has stressed the need for greater education of the benefits the risk transfer and asset class can bring to underserved regions across the globe.

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 26 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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Artemis’ Q4 2015 Catastrophe Bond & ILS Market Report – Outright market growth continues

We’ve now published our Q4 2015 catastrophe bond & ILS market report.

This report reviews the catastrophe bond and insurance-linked securities (ILS) market at the end of the fourth-quarter of 2015, looking at the $1.525 billion of new risk capital issued and the composition of the cat bond & ILS transactions completed during Q4 2015. The report also includes a review of the full year 2015 issuance and commentary from co-editor GC Securities.

Download your copy here.