Smoother, simpler transaction process anchoring cat bond market’s rapid momentum: Appleby’s Adderley

Speaking with Artemis, Brad Adderley, Partner at global law firm Appleby, emphasised that due to so many new sponsors venturing into the catastrophe bond space as the market continues to gain more momentum, it’s important that sponsors’ first experience in the market goes well, as he highlights that the overall process of setting up cat bond transactions is much better today than it was years ago.

Artemis spoke with Adderley ahead of the launch of our Q2 catastrophe bond and related insurance-linked securities (ILS) market report.

In total, Artemis recorded nine new market entrants that sponsored their debut catastrophe bonds in the second-quarter of 2026, breaking the previous record, which was eight first-time sponsors seen in both of Q2 2025 and Q2 2007.

While this expanding participation is excellent for the market’s long-term health, Adderley told Artemis when we spoke to him ahead of our Q2 2026 cat bond and related ILS market report, that ensuring each new sponsor’s initial experience is seamless remains equally critical.

“It is incredibly important because you want that first experience in the market to be positive,” Adderley said.

“Because cat bonds are executed so frequently now, the overall process is much better than it used to be when the market was still relatively new. New sponsors today experience a much smoother, streamlined process than they would have a number of years ago.”

He continued: “I don’t hear stories of flawed structures or sponsors being unhappy with how their transactions settled. Instead, I hear the complete opposite. This means the cat bond product is doing exactly what it is supposed to do, which is precisely what we want. As a direct result of that success, we are seeing more sponsors reliably returning to the market to renew their expiring deals.”

In addition, Adderley also outlined how both the legal documentation and market language surround cat bonds is much simpler today than it was years ago. And as cat bonds continue to become a mainstream risk transfer tool, he noted that first-time sponsors are entering the market with a much clearer idea of what the execution process is actually going to look like.

This wave of new sponsors also comes as H1 2026 officially broke the record for the most catastrophe bond deals to come to market and settle in the first six months of the year.

However, as Adderley told Artemis, one key trend that’s helped drive this momentum is how comfortable sponsors have become with the mechanics of the overall cat bond space.

Given how H1 2026 managed to set a new record for cat bond issuance, Adderley explained whether he has noticed any key structural shifts or emerging trends within the market that have helped drive this volume.

“I don’t think there’s anything fundamentally different in the structures. I think the market is going to continue to gain further momentum simply because more people are becoming comfortable with cat bonds and insurance-linked securities (ILS),” Adderley said.

He continued: “There is a lot of investor capital out there waiting to be deployed, and we are seeing a steady influx of new sponsors. On top of that, market participants are increasingly mixing different types of risks together. A few years ago, we primarily saw property catastrophe deals dominate the space, but now we are regularly seeing cyber and casualty risks being introduced. What is really driving this momentum is that people are getting comfortable and the market itself is becoming mainstream.”

Lastly, as AI continues to dominate conversation across the broader re/insurance market with more companies adopting AI into their workflows, Adderley remains somewhat skeptical about how much of an immediate impact it will have on the ILS and cat bond markets.

“I think AI will be used a lot more in the future, but it isn’t being utilised heavily yet. The insurance and reinsurance sectors have traditionally been slow to adapt to new technology. While AI is prominent globally, I do not see the industry acting as a first mover here. I don’t expect the sector to gravitate heavily toward it within ILS or cat bonds just yet,” he explained.

For a detailed look at Q2 and H1 2026 catastrophe bond market activity download our latest report here.