Atlantic Hurricane Season

Aeolus Capital Management Ltd., the specialist insurance-linked securities (ILS) and reinsurance investment manager, has announced a new research collaboration with Cornell University’s Department of Earth and Atmospheric Sciences, aimed at improving the modelling of hurricane tracks and assessing landfall risk with greater accuracy.

Insurance solutions provider Orion180 has increased its reinsurance tower by 31% year-over-year, reaching $845 million of limit for the 2025 hurricane season. The completed placement includes both excess-of-loss (XOL) and net quota share agreements, reflecting the company’s continued growth in high-risk, catastrophe-exposed markets.

While the reinsurance market and its pricing would be expected to re-firm after any large hurricane losses suffered during the 2025 season, it is not expected to drive a severe market hardening as was seen after 2022, according to analysts at investment bank Jefferies.

In a recent commentary, Bernhard Allgäuer, Senior Investment Strategist at VP Bank, outlined why insurance-linked securities (ILS) investors “have reason to be optimistic” heading into the 2025 Atlantic hurricane season, citing elevated risk premia and a favourable technical setup that could support returns.

The Colorado State University (CSU) tropical meteorology team has maintained its forecast for the 2025 Atlantic hurricane season to see above-average levels of activity, citing low odds of El Niño occurring during the peak season and keeping its forecast numbers relatively aligned with the recent 10-year average.

The 2025 Atlantic hurricane season forecasts, alongside physical indicators for conditions and internal risk modelling, suggest a season of average-to-moderate activity, leading specialist insurance-linked securities (ILS) investment manager Twelve Securis to call it a “relatively balanced risk landscape.”

The UK Met Office has joined calls for above-average levels of 2025 Atlantic hurricane season activity, forecasting 9 hurricanes and 4 major hurricanes as the most likely number to be experienced, citing signals for continued neutral El Niño conditions and vertical wind shear at near to or below-normal levels.

Tropical Storm Risk (TSR) has released its pre-season forecast for the 2025 Atlantic hurricane season today and has raised its figures for the number of storms and hurricanes it predicts, also raising the number of landfalling US hurricanes in its forecast to 3, while joining calls for an above-average level of activity.

With just over one week until the official start of the 2025 Atlantic hurricane season on June 1st, US weather agency NOAA has issued its first forecast, giving a 60% chance of above normal activity levels, with between 6 and 10 hurricanes predicted over the coming months.

As the 2025 Atlantic hurricane season nears, Schroders Capital’s insurance-linked securities (ILS) team is cautioning investors against overreacting to early-season forecasts, with Mark Gibson from the company highlighting the need for a continued focus on risk fundamentals and portfolio diversification.