Asian ILS market to benefit regional re/insurers: Fitch

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The development and growth of an insurance-linked securities (ILS) market in Asia can only be a benefit to local insurance and reinsurance carriers, as well as those operating regionally, as the capital markets capacity can help them expand their ability to underwrite and diversify capacity sources, rating agency Fitch explained recently.

Fitch noted in a recent report that Asian insurers and reinsurers are taking up catastrophe reinsurance and retrocession cover in excess of the minimum regulatory requirements to improve their risk mitigation capabilities.

In the future insurance-linked securities (ILS), such as catastrophe bonds and other securitised reinsurance or retro arrangements backed by capital market investors, are likely to assist in this regard.

ILS Capital gives pension fund 11.4% return

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ILS Capital Management Ltd, the Bermudian-based manager of insurance-linked securities investments, delivered a double-digit return to a major investor last year.

Bob Jacksha, chief investment officer of the New Mexico Educational Retirement Board, a $12.9 billion pension fund, said their investment with the Bermudian fund manager produced a return of 11.4 per cent in 2018.

ILS Capital Management was founded by Don Kramer, the reinsurance veteran who is the company’s chairman.

Spinnaker’s growth ambitions to receive support from ILS market

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Program and fronting service specialist, Spinnaker Insurance Company, expects further organic growth as it continues to scale its operations with the support of the insurance-linked securities (ILS) space, according to General Counsel, Nicholas Scott and Senior Vice President (SVP), Adam Tyburski.

Launched in 2015 by ex-Arch Re Ingrey family members, the start-up focuses on writing property and casualty exposed programs from U.S. homeowners and specialty business lines.

The start-up has continued to grow since its inception, and in an interview with Artemis, Spinnaker’s Scott explained that the firm’s investments in long-term, sustainable partnerships, means much of its growth is derived from existing programs, including new programs with current partners.

Collateralized reinsurance worked as designed & advertised: John Forney, CEO UPC

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Collateralized reinsurance structures and markets worked exactly as designed and advertised, which gives United Insurance Holdings (UPC Insurance) the confidence to execute on its strategy, according to CEO John Forney.

United (UPC) is a major user of collateralized reinsurance capacity, from insurance-linked securities (ILS) funds as well as from catastrophe bond investors.

The expansive insurer, which began as a Florida property only specialist but has been expanding more broadly nationwide in the United States, has grown its use of alternative capital along with its expansion and as a result the ILS market is a key partner for the company now.

TWIA targets at least $2.1bn of reinsurance & cat bonds for 2019

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The Texas Windstorm Insurance Association (TWIA) will aim to secure at least $2.1 billion of protection from the global reinsurance and insurance-linked securities (ILS) market for the 2019 hurricane season, taking its total claims-paying capacity to at least $4.2 billion.

TWIA’s Board this week approved its staff to go to market and renew or purchase afresh whatever reinsurance and catastrophe bond coverage may be required to ensure it meets its target of coverage for a 1-in-100 year loss.

TWIA is the largely coastal residual market property insurer in the state of Texas, providing insurance to its clients in some of the most hurricane exposed regions of the United States.

ILS will enhance institutional client portfolios: Neuberger Berman

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The addition of insurance-linked securities (ILS) investment expertise, through the recently announced acquisition of the Cartesian Re ILS operations, is expected to “enhance” the institutional client portfolios offered by asset manager Neuberger Berman Group.

Neuberger Berman, a private asset manager with around $315 billion of assets, announced that it has acquired the insurance-linked securities (ILS) and collateralized reinsurance investment management entities of the Cartesian Capital Group last week.

The deal sees the Cartesian Re ILS asset management unit of Cartesian Capital and the units reinsurance and segregated accounts vehicle Iris Re acquired by Neuberger Berman for an undisclosed fee.

The new ILS investment management unit within Neuberger Berman will be called NB Insurance-Linked Strategies, while its affiliated Bermuda reinsurance vehicle Iris Re is being renamed to NB Reinsurance Ltd. In addition, former owner Cartesian Capital Group is set to work with Neuberger Berman as it delivers ILS services and investment opportunities globally.

BBC pension allocates to Securis managed ILS fund

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The pension fund of the BBC, or British Broadcasting Corporation, has made a fresh allocation to insurance-linked securities (ILS) in 2018, with a £98.1 million (approx. $127m) investment in an ILS fund managed by Securis Investment Partners.

The BBC Pension Trust had previously been invested in the ILS space, but exited back in 2015 when it pulled back on a mandate it had in place with ILS fund manager Nephila Capital.

That previous ILS mandate had been in place since late 2010 or early 2011, but then the BBC pulled back from ILS at a time when rates had been on a steep decline and so returns in the space as well.

Should Fannie & Freddie transfer earthquake risk to the capital markets?

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The two government-sponsored enterprises (GSE’s) in mortgage risk, Fannie Mae (the Federal National Mortgage Association) and Freddie Mac (the Federal Home Loan Mortgage Corporation), should be required to transfer some of the earthquake risk exposure they carry to the capital markets, according to a report.

The report from nonprofit, nonpartisan, public policy research organisation the R Street Institute, calls for the two GSE’s to reduce the potential for a hit to a taxpayer, should a major earthquake strike.

PAID Romania – a model for reforming the mandatory home insurance system in Kyrgyzstan

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Initiated by the World Bank, a technical knowledge exchange meeting was held in Bucharest with PAID Romania representatives and a delegation consisting of high-level representatives of the insurance market and the Kyrgyz parliament, on the topic of the Romanian experience in building a compulsory home insurance scheme.

Organized as part of an experience exchange tour on the mandatory home insurance schemes against the risks of natural disasters in Romania and Turkey, the meeting in Bucharest aimed at transferring information on the functioning and technical details of the Romanian catastrophe insurance program, considered as a successful model that can underpin the reform and improvement of the similar system implemented in Kyrgyzstan.