Innovation helps ILS & cat bonds continue to beat records : Aon Benfield


The insurance-linked securities (ILS) market’s ability to structure innovative transactions has helped it to continue to break records, with a new high for first-quarter ILS and catastrophe bond issuance being seen in 2015, said Aon Benfield Securities.

Aon Benfield Securities (ABS) recognises Q1 2015 catastrophe bond and ILS issuance as reaching a new record, $1.7 billion by its reckoning. This is below Artemis’ Q1 2015 issuance figure of almost $2.1 billion as ABS does not include the private cat bond or cat bond lite transactions that we cover in our reports and database.


Retail investors to increasingly invest in ILS & reinsurance: KPMG’s Bridgewater


More and more investors are continuing to access reinsurance risk through established entities and via the set-up of new vehicles, as hedge fund managers and similar provide investors with increased access to the market, according to Craig Bridgewater of KPMG.

Speaking to A.M. BestTV at the 2015 SIFMA event in New York recently, Managing Director at the Bermuda-based unit of KPMG, Craig Bridgewater, discussed the future of the insurance-linked securities (ILS) market, highlighting some current changes.


How We Run Our Money: Linde Group


Christoph Schlegel, head of pension investments at Linde, outlines his fund’s economic scenario planning and dynamic investment approach. 

Few would deny that a paradigm shift is taking place in investment, as the financial markets move through uncharted territory. Not many investors, however, are ready to embrace that change.

The Linde Group, a DAX 30 international gases and engineering group, has done that. In an effort to bring its pension management up to scratch, the company believes it has an innovative strategy to manage its pension liabilities. Christoph Schlegel, Linde’s head of pension investments, leads the team that is tasked with harmonising the investment strategies of the company’s coterie of pension funds.


Equity investing can be as risky as catastrophe reinsurance investing


For large institutional investors with diversified portfolios of investments across multiple asset classes, the addition of a small allocation to catastrophe risks and reinsurance linked investments can actually be no more risky than their allocations to equities.

One of the more misunderstood, or perhaps overlooked, aspects of the insurance-linked securities (ILS) and reinsurance linked investments strategy is that, typically, investors only allocate a small amount of their capital to this asset class.


Expect more alternative capital deployment in Bermuda: Ross Webber, BDA


An interesting few years lies ahead for the global reinsurance market as capital continues to enter the space from varied sources using diverse deployment methods, according to Ross Webber, Chief Executive Officer (CEO) of the Bermuda Business Development Agency (BDA).

Speaking to A.M. BestTV earlier this year at the 2015 SIFMA event in New York, Webber discussed the types of new capital that is persistently entering the reinsurance sector, the drivers for the growth of alternative capital and what this means for the market’s future.

Moscow times

Russia Looks to China to Insure Major Infrastructure Projects – Report


Russia is looking to Chinese companies to reinsure major infrastructure projects, hoping they can replace Western firms that have pulled back after two international ratings agencies downgraded Russia’s credit rating to junk earlier this year, news website reported Thursday.

Representatives from the Chinese and Russian governments and insurance agencies met to discuss the issue earlier this month, the report said, citing participants in the meeting.


Delegation to put Bermuda’s case in Brussels


A Bermuda delegation is to travel to the European Union HQ in Brussels in June in a bid to protect Bermuda’s international business.

The visit is the latest in a series of high-profile trips to lobby EU institutions over upcoming EU laws which could damage the Island’s insurance and reinsurance industry.

Business Insurance

Quiet Atlantic hurricane season predicted for 2015


Researchers at Colorado State University have issued a prediction for a well-below-average hurricane season for the Atlantic basin in 2015, forecasting seven named storms and just three hurricanes, the university said Thursday.

The Colorado State University Tropical Meteorology Project team further forecast that only one of the three predicted hurricanes would reach major hurricane strength of Category 3, 4 or 5 on the Saffir-Simpson scale, with sustained winds of 111 mph or greater.


Alternative reinsurance capital on track to hit $150B by 2018: Aon Benfield


The alternative reinsurance capital growth rate experienced in 2014 suggests that the insurance-linked securities (ILS), collateralized reinsurance and catastrophe bond space will hit $150 billion of capital by 2018, according to Aon Benfield.

Alternative capital in the reinsurance sector grew by 28% in 2014, leaping from $50 billion at the end of 2013 to almost $64 billion at the end of last year. That growth rate is aligned with Aon Benfield’s forecast from 2013, when the broker said it expected to see another $100 billion of capital inflows over the coming five years.


NAIC continues to examine cat bonds as investment for life insurers


The NAIC will continue to assess whether it should change the capital treatment of catastrophe bonds for life insurers investing in them, with next steps being to develop statutory accounting guidance for cat bonds and to canvass life insurers interest in them as assets.

At a meeting held on Sunday the U.S. National Association of Insurance Commissioners Valuation of Securities (E) Task Force discussed the proposal,which Artemis covered here last year, that had originally been put before them by U.S. primary insurer Nationwide and the North American CRO Council.