Insurance linked securities news, ILS news

Florida’s Citizens Property Insurance Corporation continues to see increasing policy counts as ongoing challenges in the private market drive policyholders back to the residual market, resulting in expanding exposure levels and putting depopulation, or takeouts, back in focus.

A survey of institutional investors by Eaton Partners found that almost two-thirds intend to increase their allocations to alternative asset classes and private capital markets, with 9% of respondents targeting non-correlated assets specifically, while ESG is also seen as an important factor for future investment flows.

The increasingly sophisticated base of investors in the insurance-linked securities (ILS) universe are eager to push the market forward, but there are some forces holding back greater demand, according to industry experts.

The Bermuda Stock Exchange (BSX) continues to be the listing venue of choice for the catastrophe bond market with a significant percentage of the outstanding market housed there and has even won the listing for the first cat bond to be issued out of Hong Kong.

Private insurance-linked securities (ILS) funds, that invest in collateralised reinsurance and retrocession, took the biggest hits from hurricane Ida in August and as the event happened so close to the end of the month significant uncertainty remains over valuations, with further declines possible when September returns are reported.

Schroders Capital continues to explore opportunities to expand its specialist insurance-linked securities (ILS) investment management business, with the Lloyd’s market and run-off business seen as two possible avenues of opportunity.

The City of Zurich Pension Fund announced a rebalancing of its portfolio strategy, part of which will see the investor as much as double its allocation to the insurance-linked securities (ILS) asset class.

Yesterday, October 5th 2021, saw what appears to be the most significant day of catastrophe bond names “trading” and being registered on the FINRA Trade Reporting and Compliance Engine (TRACE) ever, with somewhere around 114 individual names, or tranches, of cat bond notes recorded as seeing activity.

The first catastrophe bond to be issued out of Hong Kong positions the emerging insurance-linked securities (ILS) domicile as a gateway to global institutional capital for China’s risk transfer and reinsurance needs, according to Aon Securities, who also highlighted that local investors participated in the transaction.

Markel CATCo Investment Management, the in run-off retrocessional reinsurance manager of insurance-linked securities (ILS) funds, is to be the subject of Chapter 15 bankruptcy proceedings, with filings made in the United States that have also disclosed Danish pension fund investor PKA A/S as a major holder.