Archive for August, 2020

Arch Capital Group Ltd., the Bermuda headquartered insurance and reinsurance firm with a growing mortgage insurance arm, is returning to the capital markets to secure its second mortgage insurance-linked securities (ILS) transaction of 2020, with a $363 million Bellemeade Re 2020-2 Ltd. transaction.

Hurricane Laura has now been downgraded to a tropical depression as it moves over Arkansas but it has taken more than 24 hours from landfall for its sustained winds to drop below storm strength, with the significant footprint of the large storm likely to make damage assessment take time.

While hurricane Laura was intensifying rapidly on its path towards the Gulf Coast, insurtech firm Tremor Technologies ran a series of industry loss warranty (ILW) auctions, but no trades were made as the market assumed the loss would not be significant enough to warrant the added coverage.

Insurance and reinsurance industry losses from hurricane Laura’s onslaught of the Louisiana and Texas Gulf Coast region today are expected to be manageable for the industry, despite the intensity of the storm, analysts have said.

The decline in available retrocessional reinsurance capacity is being exacerbated by ongoing fears over potential losses related to the COVID-19 coronavirus pandemic, on top of the added issue of pre-emptive trapping of collateralised ILS capacity, according to the rating agency.

A number of the major property and casualty insurers that are seen as most exposed to hurricane Laura’s impacts on the Gulf Coast region could tap into their reinsurance programs, should the major hurricane prove particularly impactful.

According to our market sources, secondary market trading of catastrophe bonds under the approach of hurricane Laura was “relatively light” by comparison to other major hurricane threats, perhaps suggesting that the uncertainty in the forecast cone made it more attractive to hold onto certain positions.

The ongoing spate of California wildfires continues to burn, with more properties destroyed in the last day and an estimate from Moody’s Investors Service suggesting insurance and perhaps reinsurance market losses are already at over $1.5 billion.

Markel CATCo Investment Management’ in run-off retrocession focused investment fund, the CATCo Reinsurance Opportunities Fund Ltd., is to release a further $25.6 million of its trapped capital back to investors, as more positions in its side-pockets see positive reserve development.

Hurricane Laura has made landfall in the last hour as an extremely dangerous and large Category 4 hurricane with 150 mph sustained winds, near Cameron, Louisiana, around 30 miles SSW of Lake Charles.