Catastrophe bonds and insurance-linked securities news

The insurance-linked securities (ILS) investment community is confident in the ability of the catastrophe bond segment to continue growing, with all the fundamentals said to currently be in place for the cat bond market to experience its first $20 billion issuance year in 2024.

The California Earthquake Authority (CEA) entered the January reinsurance renewals with almost one billion dollars more in risk transfer than a year earlier, as the group reached December 31st 2023 with $9.1 billion of protection in-force.

Market developments are helping to set the foundations to make catastrophe bonds a much more broadly accepted asset class, according to MariaGiovanna Guatteri, CEO of Swiss Re Insurance-Linked Investment Advisors Corporation (SRILIAC), who feels the asset class remains attractive despite recent tightening.

Tokio Marine & Nichido Fire Insurance Co. Ltd., the giant Japanese primary insurance group, has now secured the targeted $100 million Kizuna Re III Pte. Ltd. (Series 2024-1) of earthquake reinsurance from its latest catastrophe bond, with the coverage priced at the low-end of initial guidance.

In Q4 2023, the catastrophe bond investor base pushed for higher risk-adjusted returns amid favourable market conditions, with the average price change of spreads over the issuance process swinging to positive for the first time in the year. However, looking at Q1 2024 data so far, a very different picture is emerging.

Having only just priced a new first-event catastrophe bond, the SageSure linked SureChoice and Elevate reciprocal exchanges are back and already seeking up to $130 million of second and subsequent event named storm reinsurance from a Gateway Re Ltd. (Series 2024-2) cat bond issuance.

We reported earlier this week that the Government of Mexico is back in the catastrophe bond market with a new World Bank facilitated IBRD CAR Mexico 2024 parametric catastrophe bond. That deal is missing one of its usual components, a Pacific hurricane tranche, but sources tell us to expect one, once any recovery from hurricane […]

The Texas Windstorm Insurance Association (TWIA), the residual market property insurer for the State of Texas, has returned to the catastrophe bond market seeking to place a large $600 million Alamo Re Ltd. (Series 2024-1) issuance as it looks to build-out its reinsurance for the years ahead with the help of the capital markets, Artemis […]

Asset manager Schroders Capital has seen continued growth in its insurance-linked securities (ILS) business, announcing assets under management (AUM) of more than $5 billion across its range of vehicles.

Global reinsurance giant Swiss Re has hired a former insurance-linked securities (ILS) employee back from investment bank Goldman Sachs, with Edward Barton rejoining the reinsurer as Head of ILS Structuring Americas.