Swiss Re Insurance-Linked Fund Management

PCS - Emerging Risks, New Opportunities

Aon Benfield ILS Indices see lower performance in Q1


Aon Benfield Securities report on Q1 activity in the catastrophe bond and insurance-linked securities market (which we’ve written about earlier today here) also contains an update on the performance of their Aon Benfield ILS Indices. Aon launched the indices last August hoping to provide a quantitative monthly view of ILS returns which would help to benchmark the industry.

As we’d expect, given the impact to the other indices and returns from investment funds, the Aon Benfield ILS Indices have seen lower performance in the last quarter. Both the Aon Benfield All Bond and BB-rated Bond indices have posted negative returns, the impact of mark-to-market losses on Japanese earthquake exposed catastrophe bonds. The All Bond index returned -2.04% during Q1 compared to a positive 3.36% for the same quarter last year. The BB-rated index returned -3.21% for the quarter compared to a positive 3.48% the previous year.

Interestingly Aon Benfield also track two other indices, one made up of U.S. hurricane exposed cat bonds and the other U.S. earthquake exposed deals. These both saw positive gains during the first quarter however those returns were still negatively impacted by the disaster in Japan as they are well down on the same period of 2010. The U.S. Hurricane Bond index returned 0.89% compared to 3.23% the previous year. The U.S. Earthquake Bond index returned 1.21% compared with 2.09% in Q1 2010.

Aon Benfield say that they expect spreads, and as a result prices, to remain stable in the run up to hurricane season. They say that if there are no more major global catastrophes they expect the indices to perform strongly through the rest of 2011.

Artemis Live - ILS and reinsurance video interviews and podcastView all of our Artemis Live video interviews and subscribe to our podcast.

All of our Artemis Live insurance-linked securities (ILS), catastrophe bonds and reinsurance video content and video interviews can be accessed online.

Our Artemis Live podcast can be subscribed to using the typical podcast services providers, including Apple, Google, Spotify and more.

Print Friendly, PDF & Email

Artemis Newsletters and Email Alerts

Receive a regular weekly email newsletter update containing all the top news stories, deals and event information

  • This field is for validation purposes and should be left unchanged.

Receive alert notifications by email for every article from Artemis as it gets published.