Coronavirus news

The average return of the insurance-linked securities (ILS) fund market was dented in October 2020 by some selling pressure on certain aggregate catastrophe bond positions and reserve setting for potential losses to catastrophe reinsurance programs due to the COVID-19 pandemic.

Global reinsurance giant Munich Re has lifted its estimate for losses from the COVID-19 pandemic to more than US $4 billion for 2020, as the reinsurer increased its estimate significantly to account for fourth-quarter losses.

Some insurance-linked securities (ILS) funds that invest in collateralised reinsurance contracts have been setting reserves for potential exposure to business interruption losses due to the COVID-19 pandemic in a handful of the major European catastrophe reinsurance programs, we understand.

Within both the market and contracts the exclusion of communicable diseases is unsurprisingly a key focus, but there are other, similarly difficult to predict losses that companies should be examining, according to industry experts.

Reinsurance capital could find itself on the hook for the largest share of COVID-19 losses from second waves of the virus sweeping Europe, with primary insurers largely happy with their loss-picks so far, analysts at Barclays have said.

The World Bank’s 2017 pandemic catastrophe bond has provided a blueprint for how insurance-linked securities (ILS) technology can be leveraged to transfer pandemic risk, according to Joanna Syroka, Director of New Markets, Fermat Capital Management, LLC.

The implications of the ongoing Covid-19 pandemic on the re/insurance market suggests that the availability of capital is going to be a major issue, according to Tom Johansmeyer, Head of PCS.

American International Group’s (AIG) insurance-linked securities and collateralised reinsurance investment manager entity, AlphaCat Managers, saw a slight decline in ILS assets under management during the third-quarter of the year, but delivered its parent improved investment fee income.

September 2020 saw the strongest level of returns from the insurance-linked securities (ILS) market in a year, as the average ILS fund return was reported as 1.08% by ILS Advisers.

France headquartered global reinsurance company SCOR has reported its Q3 results today and revealed that, despite the high frequency of natural catastrophe claims in the United States, the reinsurers nat cat ratio stands under budget.