Insurance-linked securities investment fund strategies, across catastrophe bonds and private ILS, delivered another strong month of returns in September 2026 with their upward momentum continuing, as the average ILS fund performance reached 1.55%, the latest data from the ILS Advisers Fund Index shows.
ILS fund returns have been driven by seasonal premium accrual through a period with no major catastrophe loss activity, which continued through September.
A month ago, ILS Advisers reported August returns provisionally at 1.39%, but once all the data was in from ILS managers the figure for that month is higher, standing at a 1.60% return for the period.
September’s reporting is already based on 100% of constituent ILS funds in the Index, with the 1.55% average return the second-highest monthly performance for the sector only to the now updated August figure.
On that basis, the average ILS fund performance for the first nine months of 2026 now stands at 8.43%, as another benign month of severe weather and natural catastrophe activity meant no significant losses for insurance-linked securities fund strategies, it seems.
ILS Advisers noted that, “September was another relatively uneventful month for the insurance-linked securities market,” highlighting the lack of storm activity in the Atlantic hurricane basin.
Even with the Pacific seeing more significant levels of storm activity, ILS Advisers explained, “Despite these significant weather systems, reported damage remained limited, and we do not expect any material impact on the ILS market.”
All of which has helped to buoy investment returns for ILS funds, both across catastrophe bonds and private ILS contracts focused on collateralized reinsurance and retrocession.
“Against this benign catastrophe backdrop, ILS investments continued their upward trajectory, delivering another strong month of performance,” ILS Advisers said.
Firstly, September 2026 was a month when the breadth of risk-return strategies within the ILS fund market was made very clear.
ILS Advisers commented that, “All funds reporting September returns to the index posted positive results, with monthly performance ranging from 0.72% to 7.11%.
“This wide dispersion highlights the diversity of the ILS universe, spanning more defensive, lower-volatility strategies to higher-octane approaches offering greater return potential, typically accompanied by higher risk.”
Across the pure catastrophe bond funds tracked by the Index, the average return for September was 1.28%, a particularly strong month for the asset class.
For the group of ILS funds that also allocate to private ILS positions, to varying degrees, the average monthly return was even higher at 1.91%, again particularly strong.
As a result, the ILS fund sector has extended its stretch of positive monthly returns, with the last negative month having been January 2025 after the California wildfires.
2026 is well on-track for this Index to deliver a return in the low double-digits, which will compare very well versus history and could result in one of the four or five best performances for this benchmark since it began tracking the sector in 2006.
You can track the ILS Advisers Fund Index here on Artemis. It comprises an equally weighted index of 37 constituent insurance-linked investment funds which tracks their performance and is the first benchmark that allows a comparison between different insurance-linked securities fund managers in the ILS, reinsurance-linked and catastrophe bond investment space.
View 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.
