Collateralized reinsurance news

The ILS Advisers Index, which tracks the performance of numerous insurance-linked securities (ILS) and reinsurance linked investment funds, scraped to a positive return of just 0.08% in the month of February 2018, as the impacts of prior losses continued to reverberate around the ILS market.

Insurance-linked securities (ILS) and collateralized reinsurance investment fund manager Blue Capital Management, a subsidiary of Sompo International Holdings Ltd., may seek to raise more funds as it looks to grow its London-listed strategy, the Blue Capital Alternative Income Fund.

Hannover Re may have recovered as much as $815 million from its retrocessionaires for losses from the major catastrophe events of 2017 and with the capital markets cited as playing a “key role” in its retro arrangements, it stands to reason that investors will have taken a reasonable sized share.

U.S. primary insurer Chubb has reported that its catastrophe losses from the first-quarter of 2018 are estimated to be $380 million net of reinsurance and before tax, which includes the impacts from the California mudslides.

The U.S. Federal Emergency Management Agency (FEMA) has confirmed its intention to enter the insurance-linked securities (ILS) market for the first time for a mid-year 2018 transfer of risk from the National Flood Insurance Program (NFIP), to secure capital markets backed source of flood reinsurance using a catastrophe bond.

During the last quarter of record the Pioneer ILS Interval Fund, a U.S. mutual fund insurance-linked securities and reinsurance linked investment strategy operated by asset manager Amundi Pioneer Investment Management, expanded significantly, growing assets under management for the strategy by 88% to over $676 million.

Insurance-linked securities (ILS) remain an attractive and diversifying asset class, and with returns now expected to be higher following 2017 catastrophe events and the subsequent impact on reinsurance industry pricing, Mercer’s Robert Howie suggests investors should look to the space in 2018.

The insurance and reinsurance industry loss estimate for Cyclone Debbie has been finalised at AU $1.74 billion by PERILS AG, a 5% on the previous report of the market-wide loss from the storm and now equivalent to roughly US $1.34 billion.

Insurance-linked securities (ILS), catastrophe bonds and collateralized reinsurance funds saw divergent performance during the month of February, as a number saw their performance hit as they were required to make adjustments to prior month loss estimates during the period.

Artex, one of the largest insurance management firms and a key facilitator in the insurance-linked securities (ILS) and collateralised reinsurance space, has hired one of its co-founders back from competitor Aon, with Peter Mullen set to return in the position of CEO-elect.