The private insurance-linked securities (ILS) market is approaching the January renewals from a strong standpoint, with capacity projected to be marginally higher, which may exert some pricing pressure. However, according to Cahal Doris, CIO Private ILS at Twelve Securis, the firm still expects to observe technical discipline within the market.
Within the wider ILS market, private ILS strategies, such as collateralized reinsurance, retrocession and other privately negotiated placements, have shown demonstrated heightened activity and investor engagement throughout 2025.
Reflecting on this momentum, Artemis spoke to Doris who shared what opportunities the ILS manager foresees for the private ILS sector for the 1/1 renewals, whilst also providing an outlook for the sector for 2026.
“The private ILS market is entering the 2026 renewals from a strong position. Three years of very strong underwriting performance since 2023 have gained investors’ confidence. The modest impact of recent events, such as the Los Angeles wildfires and Hurricane Melissa have provided confidence in the structural changes in the market since hurricane Ian in 2022,” Doris told Artemis.
“Capacity is expected to be marginally higher heading into 1/1, creating some price pressure, but we still anticipate technical discipline from the market. Aggregate covers exposed to non-peak perils remain scarce and high occurrence attachment points are prevalent in most reinsurance and retrocession programmes,” Doris continued.
The CIO also affirmed that on a risk-adjusted basis, expected returns remain attractive. He further noted although the industry has not seen significant inflows of capital, retained earnings will lead to a rise in supply.
“Overall, for 2026 we see opportunity in being selective across the breadth of reinsurance and retrocession, and this space will be attractive for investors who are looking to achieve returns above that of the cat bond market,” Doris said.
Moving forward, Doris also outlined that 2026 presents a number of potential challenges for the ILS sector, which includes managing the market cycle, with counterparties potentially able to widen the scope of perils covered to include perils such as wildfire and severe convective storm.
As the CIO explained to Artemis, these perils add modelling complexity and require disciplined underwriting.
“ILS managers will continue to be under scrutiny to evidence they understand and mitigate the elements of climate change affecting their portfolios. We will continue to invest in our research into these areas in 2026,” Doris added.
In addition, macro uncertainty remains a key concern, with both inflation and geopolitical risks influencing insured values and capital costs.
Doris stressed that as pricing gradually begins to soften, maintaining the structural improvements achieved since the 2023 hard market will remain essential.
“Key opportunities lie in the continued expansion of the issuer base, including corporates seeking climate-related risk transfer, and steady innovation in areas like parametric insurance. With catastrophe risk still offering attractive relative value compared to traditional credit markets, investor engagement remains positive,” Doris continued.
Concluding: “Overall, the sector enters 2026 on solid technical footing, underpinned by improved structures and a rational pricing environment.”
Also read: Catastrophe bond market poised to carry record momentum into 2026: Schwartz, Twelve Securis
Read all of our interviews with ILS market and reinsurance sector professionals here.
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.
