Reinsurance linked investment

Brookfield Reinsurance, the Bermuda-based reinsurance entity of Brookfield Asset Management Inc., the giant Canadian headquartered alternative asset manager, has entered into a definitive agreement to acquire specialty re/insurer Argo Group International Holdings, Ltd. in an all-cash transaction valued at $1.1 billion.

During a January 1st renewal season the reinsurer describes as a very challenging market environment for all participants, Hannover Re secured an increase in natural catastrophe retrocession, including the expansion of its capital markets backed K-Cessions quota share sidecar facility of almost 85% to $831 million, the biggest it’s ever been.

Independent investment management giant Cambridge Associates LLC is bullish on the outlook for insurance-linked securities (ILS) investing in 2023, believing the higher yields on offer provide a good return opportunity relative to risk. But they caution that investors should review the ILS asset class on a regular basis.

In reinsurance, the industry had softened its pricing to an unsustainable degree, resulting in a situation where margins for capital providers were thin to non-existent. But, recent moves in pricing, terms and conditions are an attempt to “balance things in favour of the reinsurers,” Aditya Dutt, President of Aeolus Capital Management explained.

According to the final year-end data for the Eurekahedge ILS Advisers Index, an equally weighted index that tracks the performance of 26 constituent insurance-linked investment funds, on average, pure catastrophe bond funds performed the best in 2022, while the gap between the top and bottom performing ILS funds was particularly significant.

Here are the ten most popular news articles, week ending February 5th 2023, covering catastrophe bonds, ILS, reinsurance capital and related risk transfer topics. To ensure you never miss a thing subscribe to the weekly Artemis email newsletter updates or get our email alerts for every article we publish.

Insurance-linked securities (ILS) and catastrophe bond funds only fell by -2.16% on average for the full-year 2022, despite the significant losses the industry suffered from major hurricane Ian, an Index of ILS fund performance shows.

Specialist insurance-linked securities (ILS) and reinsurance investment manager Twelve Capital believes the catastrophe bond investment opportunity to be particularly compelling for 2023.

Nephila Capital, one of the largest insurance-linked securities (ILS) fund management operations in the market, has added $200 million of new capital in time for deployment around the January reinsurance renewals, which took its assets under management to $7.4 billion.

Following the enactment of significant property insurance legislative reform in Florida and after giving these reforms time to bed-in, catastrophe bonds covering risks in the state are likely to become even more attractive to invest in, according to Dirk Schmelzer of Plenum Investments.