Insurance Linked Investments

Hudson Structured Capital Management (HSCM), the reinsurance, insurtech, insurance-linked securities (ILS) and transportation focused investment manager, has invested through entities of its HSCM Bermuda unit, in life insurance sector specialty lender and premium finance firm Gracie Point Holdings, LLC.

American International Group, Inc. (AIG) has announced that Chris Schaper, its Chief Executive Officer of reinsurance units AIG Re and Validus Re, is set to also take on CEO responsibilities for its insurance-linked securities (ILS) unit AlphaCat Managers.

Thanks to the sophistication of the insurance-linked securities (ILS) market and investors demonstrated resilience over recent loss-heavy years, analysts at KBW conclude that even huge catastrophe events won’t drive a capacity shortfall in reinsurance any more.

Research from Ceres, the non-profit focused on sustainability challenges such as global climate change and water scarcity and their implications, has found that major US banks have more than $250 billion of exposure to physical climate risks annually sitting in their loan portfolios.

The retrocessional reinsurance investment portfolio constructed by Markel’s CATCo Investment Management is continuing to develop more favourably than had originally been expected, with the firm reporting a reduction of claims in relation to catastrophe events from 2017.

Catastrophe risk modelling firm RMS has now added a further $6 billion to $9 billion of insurance and reinsurance market losses to its industry estimate for recent hurricane Ida, adding the expected flood toll further north and taking the total estimate range to $31 billion to $44 billion.

Hurricane Ida “reminds us that the strength and trajectory is what is important when it comes to hurricanes” and that “there is always a lot to learn from every event”. This is according to Luca Albertini, CEO of London-headquartered Leadenhall Capital Partners LLP, a subsidiary of MS Amlin.

The collateralized reinsurance market is estimated to have grown to around US $50 billion by the end of the first-quarter of 2021, with capacity having increased slightly following a more challenging period, according to AM Best.

The main mutual insurance-linked securities (ILS) and reinsurance linked mutual investment funds have experienced some declines in the wake of the recent landfall of major hurricane Ida.

Hurricane Ida is a completely different kind of loss to Hurricane Katrina, because there was no element of surprise when the category 4 storm ploughed into the Louisiana coastline on 29 August, 16 years after Katrina. This is according to Matt FitzGerald, managing partner at Gallagher Re.