Archive for August, 2025

Three key dominant trends have been revealed following a record period of catastrophe bond issuance according to Richard Pennay, CEO, Aon Securities, the specialist investment banking and insurance-linked securities (ILS) broker-dealer unit of the global insurance and reinsurance broker.

The government of the Philippines is aiming to secure enhanced climate-disaster risk financing and insurance capacity, with parametric structures likely to play a significant role, while Global Shield financing vehicles are expected to help fund the initiative.

Swiss Re, one of the world’s largest reinsurance companies, is back in the catastrophe bond market for what will be its third sponsorship this year, targeting $75 million or more in North America earthquake retrocession from a Matterhorn Re Ltd. (Series 2025-3) transaction, Artemis has learned.

Insurer USAA is set to return a further $25 million of catastrophe bond capital to investors from the extended notes of its Residential Reinsurance 2021 Limited (Series 2021-1) aggregate cat bond, presumably as loss development has continued to be more favourable under the coverage provided, this publication has learned.

Mitsui Sumitomo Insurance, a subsidiary of MS&AD Insurance Group Holdings, has unveiled its new parametric insurance product, “Weather Insurance Index”, a new offering designed to help insurers manage financial losses caused by severe or unusual weather.

The amount of alternative capital in reinsurance supplied by insurance-linked securities (ILS) strategies and structures has reached a new high of $121 billion as of the middle of 2025, which Aon Securities notes was driven by strong catastrophe bond growth and supported by ongoing expansion of the sidecar sector as well.

HDI Global and its parent company Talanx are streamlining their reinsurance purchasing operations through consolidation, signaling potential for increased and larger market transactions such as catastrophe bonds.

Following its recent publication of a discussion paper on rating insurance-linked securities (ILS), with a focus on catastrophe bonds, Moody’s Ratings has moved forward and now proposes a new methodology for rating cat bonds and other ILS, seeking final feedback before its implementation.

Every few years it feels like groundhog day again, as we begin to see a rise in negative sentiment towards the insurance-linked securities (ILS) market and its investors from major traditional reinsurance companies, typically at a time of rising competitive dynamics in the marketplace.

While reinsurance rates have been trending downward throughout 2025 as the market softens following a period of historic hardening conditions, pricing pressure is now expected to persist absent a severe hurricane season or other major loss, according to analysts at Morgan Stanley.