Catastrophe bonds and insurance-linked securities news

Allstate reported a massive toll from severe weather related wind and hail events in 2023 and has booked a $36 million catastrophe reinsurance recoverable against one of its exposed Sanders Re II catastrophe bonds for the year.

Jamaica is looking to renew its catastrophe bond cover that expired at the end of 2023 and the country’s Finance Minister Nigel Clarke said yesterday that a longer-term of protection will be sought with a new cat bond deal, with four hurricane seasons of cover to be the target.

The target size for the Gateway Re Ltd. (Series 2024-1) catastrophe bond issuance that will benefit the SageSure linked SureChoice and Elevate reciprocal exchanges has now been increased, with up to $250 million of capital markets backed reinsurance now targeted from the deal.

Fitch Ratings believes that the trend of net outflows that has been seen across insurance-linked securities (ILS) funds and structures that allocated capital directly to private reinsurance and retrocession arrangements is now over, with assets now deemed more stable, suggesting a chance of more consistent growth is ahead.

Aki Hussain, Chief Executive Officer (CEO) of insurer Hiscox, expects continued outflows from the firm’s insurance-linked securities (ILS) business in 2024, but with new money starting to come in and with Hiscox set to supplement the business with its own capital, the expectation is for net portfolio growth this year.

Hiscox Group had a particularly busy end to the year in the insurance-linked securities (ILS) space, with a new collateralised reinsurance sidecar and its first catastrophe bond fund launched, while its Hiscox ILS fund management unit also raised an additional $140 million of new capital for the January renewals and doubled its fee income.

The average return of insurance-linked securities (ILS) funds tracked by the Eurekahedge ILS Advisers Index reached 1.16% for January 2024, which was a “particularly high” performance for what is often a slower month lacking in peak peril seasonality.

By the end of February, the dedicated mutual catastrophe bond fund strategy offered by investment manager Amundi US, the Pioneer Cat Bond Fund, had grown its assets under management to reach $218 million, while delivering its investors an almost 15.9% one-year return.

American Integrity Insurance Company will now secure its upsized target of $305 million in collateralized named storm reinsurance protection from its new Integrity Re Ltd. (Series 2024-1) catastrophe bond, while two tranches of notes from the issuance are set to price below guidance.

PURE, a high-net worth insurance specialist that is part of the Tokio Marine Group, has entered the catastrophe bond market for the first time, seeking $100 million or more in named storm and earthquake reinsurance from an Ashera Re Ltd. (Series 2024-1) issuance, Artemis has learned.