Catastrophe bond news

China’s National Financial Regulatory Administration (NFRA), the financial industry regulatory agency under the State Council of the People’s Republic, is continuing to promote Hong Kong as a venue for insurers and reinsurers to sponsor catastrophe bonds.

Plenum Investments, the specialist manager of catastrophe bond and other reinsurance-linked assets, has successfully grown its Plenum CAT Bond Dynamic fund to more than $200 million of assets under management.

According to Fitch Ratings, the proposal from the Australian Prudential Regulation Authority (APRA) to remove the requirement for reinsurance arrangements to have a reinstatement in place could be a favourable move for the insurance-linked securities (ILS) market, allowing more risk to be transferred to investors from Australia’s insurance sector.

The emergence of an insurance-linked securities (ILS) market for cyber risk is seen as a critical component for the future expansion of that line of business, with the capital markets expected to be a key reinsurance and retrocession provider, Moody’s has said.

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KatRisk, the catastrophe risk modelling software provider and the third-party risk modelling agency for the NFIP’s FloodSmart Re catastrophe bonds, has been acquired by Technosylva, a company focused on wildfire simulation modeling, risk analysis and operational response software solutions.

Liberty Mutual Insurance has returned to the catastrophe bond market with a target to secure at least $225 million of indemnity based catastrophe reinsurance protection from the capital markets through a Mystic Re IV Ltd. (Series 2025-1) issuance.

During the full-year 2023, the catastrophe bond and insurance-linked securities (ILS) team at private markets focused investment manager Schroders Capital allocated over US $817 million to transactions that specifically help in reducing the insurance protection gap.

RenaissanceRe, the Bermudian global reinsurer, has lifted its third-party investor capital under management in reinsurance joint-ventures and insurance-linked securities (ILS) funds managed by RenRe’s Capital Partners division to a new end of quarter high of $7.72 billion.

On a relative basis, catastrophe bonds have rarely presented a more compelling investment opportunity than today, as despite spreads having tightened somewhat the cat bond asset class diversification offering can be at its strongest when other assets like equities are overvalued, fund manager Icosa Investments has said.