Insurance Linked Investments

Insurance-linked securities (ILS) and more broadly the reinsurance industry, must demonstrate to investors that the margin in the product is sustainable, to deliver greater confidence to capital and encourage more significant inflows to the space, Aditya Dutt, President of Aeolus Capital Management has said.

While the recent reinsurance renewals saw significant ground recovered on pricing and terms, a number of challenging themes remain and the industry must address systemic risk themes to attract enough new capital to meet significant demand, Mike Mitchell of Swiss Re has said.

HSCM Ventures, the insurance technology venture investing arm of ILS and reinsurance specialist investment manager Hudson Structured Capital Management, has participated in a $25 million funding round for life insurtech Dayforward.

VP Bank AG, a Liechtenstein-based private bank and asset manager, has said that the insurance-linked securities (ILS) investment opportunity has “never been so interesting”, with the highest yields in over a decade now possible, and further revaluation gains in hurricane Ian exposed catastrophe bonds expected.

Hurricane Ian was an important test for the profitability of the global insurance and reinsurance market, according to analysts at Goldman Sachs and their comments read-across positively for the insurance-linked securities (ILS) market as well, as returns there also show the “strength of the cycle working through.”

Elevated, near-record returns and still-evident asset class diversification benefits, leave insurance-linked securities (ILS) and alternative capital in reinsurance poised for strong growth, according to Aon’s Reinsurance Solutions.

Increasingly, non ILS specialist capital is entering the catastrophe bond market, as many investors that have allocated before return, and this is helping to stabilize the market, according to Cory Anger of GC Securities.

Insurance and reinsurance broker Aon has been working with insurtech Vesttoo on intellectual property insurance-related financing solutions, with the latter helping to bring capital markets capacity to the brokers proposition.

Rating agency AM Best has cited Vantage Risk’s insurance-linked securities (ILS) strategy, of moving catastrophe risk off its balance-sheet with the backing of third-party investor capital, as positive and able to drive income and reduce volatility.

Aspen Capital Markets, the third-party and alternative reinsurance capital management unit of global re/insurer Aspen, has announced the hiring of Chris Lee as Chief Operating Officer (COO), who joins the company from Hiscox Re & ILS.