In Swiss Re’s recent report highlighting key insights from the insurance-linked securities (ILS) market in 2023, the agency noticed a surge in new sponsors getting into the disaster bond market, alongside the return of a number of sponsors after a interval away.
The inflow of recent sponsors additionally led to a shift within the mixture of perils lined, with the introduction of some new perils.
Cyber danger was securitised in 144A disaster bond kind for the primary time in This autumn, sparking appreciable exercise with 4 distinctive sponsors issuing cyber danger notes.
Furthermore, there was a notable improve in bonds masking ‘international’ perils.
Additionally, six sponsors returned to the market after an absence of 5 or extra years, together with international reinsurance large Munich Re, marking its return to the cat bond marketplace for the primary time since 2016, together with different well-known corporations like Chubb.
This underscores the enduring relevance and attractiveness of the cat bond market throughout the broader reinsurance area.
Swiss Re’s report additionally notes, “As inflation increased the cost of claims year-on-year, carriers managed their programs by holding more risk on their balance sheets as well as ceding more risk overall. As a result, the cat bond market became a more attractive option for securing an alternative source of capacity at competitive rates.”
For extra particulars on these cat bonds and others, seek advice from the Deal Directory of our ILS-focused sister publication, Artemis.
