Category: The Market

Deteriorating market conditions have not put off investors who continue to pour money into ILS funds. The AUM of the largest ILS funds grew by $13 billion over the last year. Here are five charts on the current state of the market. 1. In...

The Florida peninsula is the most important market for property reinsurance in the world. Each summer, the third most populous state in the union braces itself for another Atlantic hurricane season. In Florida’s esoteric...

Data from the first few months of 2017 shows that there has been a steep fall in the returns of new catastrophe bonds compared with those issued in the first quarter of 2016. The returns of bonds exposed to US hurricane risk has reached...

The data shows that institutional investors remain attracted to insurance-linked funds. Investors are looking for modest returns, larger allocations and better ways to educate their stakeholders about insurance-linked securities. Clear...

2016 saw higher losses and lower returns for reinsurance assets compared to 2015. As catastrophe bond yields fell, the resulting mark-to-market bump improved the performance of those insurance-linked funds that deploy a high proportion...

Reinsurance rates are at long term lows and have slipped again at the key January 1 renewal date. Following a stable period, new catastrophe bonds also priced at lower risk-adjusted rates in 2016 compared with 2015. Optimists noted that...

Two of the big stories in 2016 were Hurricane Matthew and the rapidly increasing interest in InsurTech. Nick Martin looks back at how close the insurance industry came to the worst loss in its history and how InsurTech may be more of an...

The product warning that ‘past performance does not necessarily predict future results’ may be truer for insurance-linked funds than for any other asset class. The heavily skewed distributions of possible fund returns mean that, in any...

This is the second part of the article on the strategic choices made by insurance-linked funds. Click here to read part one. 5. Leverage. Some insurance-linked funds sit on cash, while others use leverage to amplify...

A quarterly review of reinsurance pricing metrics The third quarter is a slow month for trading reinsurance and, by itself, the thin data is inconclusive about which way the market is heading. But many participants think that...

This week, insurance executives from around the world are hard at work in the Principality of Monaco. If you couldn't make the 60th 'Rendez Vous de Septembre', InsuranceLinked's live blog is the next best thing. ...

Michael Coles is the managing director of Coles Advisory Partners. He discusses how the last few years have seen an unprecedented level of technological innovation in the insurance industry and what that might mean for the future...

What are some of the most exciting developments in distribution? How might that affect ILS funds? The re/insurance value chain is quite elongated, and there are a lot of premiums coming out of it. The reason we're excited about distribution...

A new study by InsuranceLinked estimates that 38% of global ILS fund assets are managed by firms that are headquartered in Bermuda. Specialist ILS funds and related service providers employed approximately 400 people in Bermuda at the...

Rate reductions have continued over the last 12 months, but the rate of rate reductions has also continued to reduce.  Four charts illustrate current pricing levels and how this is affecting reinsurance and ILS returns. This...

NASA's Dr Tim Hall has run his multi-factor model and read the tea leaves. In 2016, the  chance of landfalling hurricanes in the southern states is significantly higher than the long term average. Mississippi has experienced the greatest...

June 1 is the inception date for most contracts in the bellwether Florida reinsurance market. Florida hurricane exposure is the most significant risk to many reinsurance companies and ILS funds. The the mix of catastrophe risk, demographics...

In November 2012, Kweku Adoboli was imprisoned for seven years for a fraud that cost UBS over $2 billion. Rival Swiss bank Credit Suisse is now in the process of placing a bond that will protect it from operational risks like this for...

US ILW prices have held steady since the beginning of the year and secondary cat bond yields finished the quarter at a similar level to 12 months earlier. But talk of the bottom of the market may be wishful thinking as capital continues...

Responsible investment strategies have experienced rapid growth in recent years. One report estimates that $6.6 trillion (18%) of US domiciled assets are engaged in responsible investment practices. Robert Howie and Alex Bernhardt...

Data from brokers shows that property reinsurance rates have continued to fall in 2016 but more slowly than in previous years. At the key January renewal season reinsurance, retrocession and industry loss warranties experienced...

Last month, billionaire investor, Carl Icahn, noted that "unfortunately... the meltdown in high yield is just beginning". While junk bond yields have soared, reinsurance rates have continued to decline. These two opposing forces could...

A seasonal round-up of the big stories of 2015. Happy holidays. On the twelfth day of Christmas, my true love sent to me... Twelve tropical depressions As predicted by Tim Hall and others, Atlantic storm...

The glut of reinsurance capital has disrupted parts of the industry, but the insurance industry as a whole continues to post strong results. Nick Martin takes a look at third quarter earnings. Nick Martin is the Co-Manager of the...

In 2017, Bermuda will host the 35th America's cup. The build up to the oldest trophy in international sport is well underway and attracting a new kind of visitor to the island. Jimmy Spithill is a remarkable athlete - he skippered his...