Insurance Linked Investments

In reinsurance, the industry had softened its pricing to an unsustainable degree, resulting in a situation where margins for capital providers were thin to non-existent. But, recent moves in pricing, terms and conditions are an attempt to “balance things in favour of the reinsurers,” Aditya Dutt, President of Aeolus Capital Management explained.

Catastrophe bond, insurance-linked securities (ILS) and reinsurance investment manager Twelve Capital has said that its exposure to the earthquakes in Turkey through private ILS contracts appears “very limited”, with no impact expected to its products.

According to the final year-end data for the Eurekahedge ILS Advisers Index, an equally weighted index that tracks the performance of 26 constituent insurance-linked investment funds, on average, pure catastrophe bond funds performed the best in 2022, while the gap between the top and bottom performing ILS funds was particularly significant.

Equity analysts at Goldman Sachs see climate change both as a driver of increasing underwriting opportunities for the global insurance and reinsurance market, as well as a key factor that can prolong the current hard market pricing environment.

Insurance-linked securities (ILS) and catastrophe bond funds only fell by -2.16% on average for the full-year 2022, despite the significant losses the industry suffered from major hurricane Ian, an Index of ILS fund performance shows.

RenaissanceRe’s CEO Kevin O’Donnell is bullish about his firm’s prospects for 2023, particularly in property catastrophe reinsurance where he expects the reset, higher rate environment will persist throughout the year.

Nephila Capital, one of the largest insurance-linked securities (ILS) fund management operations in the market, has added $200 million of new capital in time for deployment around the January reinsurance renewals, which took its assets under management to $7.4 billion.

Following the enactment of significant property insurance legislative reform in Florida and after giving these reforms time to bed-in, catastrophe bonds covering risks in the state are likely to become even more attractive to invest in, according to Dirk Schmelzer of Plenum Investments.

Insurance-linked securities (ILS) investment manager Nephila Capital is targeting growth and expansion into the climate and specialty risks sides of its business, but property catastrophe risk remains the biggest revenue driver at this time, Markel’s Jeremy Noble said today.

At the key January 1st reinsurance renewal season, RenaissanceRe, the global reinsurance firm and third-party capital manager, purchased more retrocessional protection that had been anticipated, according to CEO Kevin O’Donnell.