Archive for July, 2017

Alternative sources of reinsurance capital, largely from ILS funds and other collateralized markets, is increasing its market share in commercial insurance, particularly in catastrophe exposed property space where rates are declining so far that traditional insurers are starting to reduce their risk appetites, according to Moody’s.

Insurance and financial services group AmTrust is set to secure an efficiency priced layer of fully-collateralized reinsurance coverage from the capital markets, as the pricing has now been fixed at the bottom end of already reduced guidance for its first catastrophe bond, the $100 million Fortius Re II Ltd. (Series 2017-1) deal.

Mexico has returned to the catastrophe bond market with a new transaction seeking a source of reinsurance risk transfer for its Fund for Natural Disasters (El Fondo de Desastres Naturales), better known as FONDEN, in a $290 million deal we’ve called IBRD / FONDEN 2017, assisted by the World Bank.

Insurance-linked securities (ILS) and catastrophe bond investment managers and their end-investors have been working hard to increase their market share in 2017, with pricing becoming increasingly efficient and now reports suggesting that terms and conditions of coverage have largely converged.

The recently completed €40 million Windmill I Re Ltd. (Series 2017-1) catastrophe bond transaction is the first to use a European windstorm risk model from Aon Benfield’s risk modelling centre of excellence Impact Forecasting.

Reinsurance firm Hannover Re has continued to expand its activities in the insurance-linked securities (ILS) transformer space, fronting and working with both existing and new clients in recent months, to secure what the company sees as a source of low risk and attractive margins.

The estimate of insurance and reinsurance industry losses resulting from the impact of European windstorm (or extratropical cyclone) Egon, which struck France and Germany on the 12th and 13th January 2017, has increased by 18% to EUR 275 million.

The recently completed EUR 200 million Lion II Re DAC catastrophe bond transaction set a new low in terms of the pricing multiple, of the expected loss level to the amount of coupon that investors will be paid, in the history of the 144a cat bond market, according to GC Securities.

Global reinsurance firm SCOR has provided capacity to back a £1 billion longevity risk transfer transaction for specialist defined benefit pension fund insurer Pension Insurance Corporation plc (PIC).

Risk modelling and analytics firm RMS has announced the launch and roll-out of new typhoon models (for both wind and flood) for South Korea and Taiwan, and new earthquake models for Singapore, Malaysia, Thailand and Vietnam, which it hopes will help to stimulate growth opportunities for insurance and reinsurance targeting the region firms.