Archive for October, 2023

The Government of Mexico’s catastrophe bond, which now appears likely to be triggered after major hurricane Otis last week, was already planned for renewal in March 2024, and the fact another cat bond might payout to the benefit of Mexico will likely make this even more of a priority.

Insurance and reinsurance broking giant Aon is continuing to work with clients to help the industry replace lost capital following the letter of credit (LOC) fraud at insurtech Vesttoo, Eric Andersen, President of Aon plc said last week.

Another new sponsor has entered the catastrophe bond market this year, with the North Carolina Farm Bureau seeking $250 million of named storm reinsurance protection from the capital markets via its debut Blue Ridge Re Ltd. (Series 2023-1) cat bond issuance.

Reinsurance broker Gallagher Re has said that hurricane Otis will be one of the costliest natural catastrophe events in Mexico’s history, with a multi-billion-dollar insurance market loss anticipated because of the devastating impacts of the storm.

Aon operated Bermuda-based segregated account company White Rock Insurance (SAC) Ltd. has issued another private catastrophe bond in the Japanese Asagao parametric earthquake series, with a $40 million Asagao VII transaction completed recently.

Here are the ten most popular news articles, week ending October 29th 2023, 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 or get our email alerts for every article we publish.

Vesttoo, the insurtech at the center of an international reinsurance letter of credit (LOC) fraud investigation, is trying to sell off assets of the firm as part of its plans to emerge from the scandal and trade forwards, but creditors are accused by the company of undermining these efforts in a display of brinkmanship.

Specialist insurance and reinsurance-linked investment manager Twelve Capital has highlighted some uncertainty with respect to the final central pressure figure that will get reported for hurricane Otis, but still believes it is probable the Mexican government’s exposed catastrophe bond tranche will face a 50% loss of principal.

Despite being home to a high frequency of natural catastrophes, re/insurance penetration remains low across much of Asia, but as risk accumulation and demand for protection rises, there’s an opportunity for the catastrophe bond market, according to Peak Re’s CEO, Franz-Josef Hahn.

Risk analytics and modelling firm CoreLogic has estimated that the “insurable” loss from hurricane Otis’ category 5 winds onslaught in the Acapulco and surrounding region of Mexico is in the range of $10 billion to as much as $15 billion.