Cat bond news

As the catastrophe bond market awaits an official determination on the potential payout of Jamaica’s $150 million IBRD CAR Jamaica 2024 parametric cat bond after hurricane Melissa, a representative of one of the deal’s structuring agents has said that early signs are that the cat bond structure is “doing what it was designed to do.”

The global insurance and reinsurance industry is facing losses in the billions of dollars after major hurricane Melissa’s devastating landfall and passage across Jamaica, while the country’s $150 million IBRD CAR Jamaica 2024 parametric catastrophe bond is likely to face a full loss, ILS investment manager Twelve Securis has said.

The average yield to maturity of the catastrophe bond market has fallen by a meaningful 25.5% year-on-year, according to data from Euler ILS Partners, the specialist Swiss insurance-linked securities (ILS) investment manager.

With footage coming out of Jamaica after major hurricane Melissa made landfall yesterday showing the damage left in the extreme storms path, rating agency AM Best has said reinsurance capital will take a meaningful share of the losses suffered, while broker BMS Group’s Andrew Siffert said the industry loss could exceed $5 billion.

RenaissanceRe, the global reinsurance company and third-party capital manager, has reported a 24.1% rise year-on-year in fee income earned from its reinsurance joint-venture vehicles and insurance-linked securities (ILS) funds in the third-quarter of 2025.

Major hurricane Melissa has intensified further to sustained winds of 185 mph and its minimum central pressure has now deepened to 892mb, which with the storm’s eye now well into the parametric boxes of Jamaica’s $150 million IBRD CAR Jamaica 2024 catastrophe bond suggests a 100% payout of principal is likely.

As per accountancy firm Deloitte’s 2026 Global Insurance Outlook, property and casualty (P&C) and life insurers are increasingly turning to investor-backed and other forms of alternative capital to navigate shifting market conditions.

As major hurricane Melissa bears down on the Caribbean island nation of Jamaica, the significant intensity of the storm could activate the country’s parametric catastrophe bond and insurance protection triggers which, should they pay out, will provide a valuable source of financial liquidity and recovery funding at a particularly challenging time for the country.

With catastrophe bond and related ILS issuance set to exceed the record $20 billion figure by the end of 2025, this momentum is expected to persist, as Brad Adderley, Partner at global law firm Appleby suggests that issuance will stay at least at its current size for the time being.

King Ridge Capital Advisors LLC, the specialist insurance-linked securities (ILS) investment manager and the sub-advisor to the Brookmont Catastrophic Bond ETF (ILS), has established a UCITS ETF catastrophe bond fund structure in Ireland.