December 2014/1

Q: A number of this year's Florida cat bonds used "cascading" structures - but what does this cover provide?

As the shape of today's insurance market continues to morph, tax law has lagged behind in its feeble attempts to force novel concepts into rusty old boxes.

The ILS market has become increasingly open to participating on deals that transfer catastrophe risk from developing countries at a governmental level.

The largest specialist ILS fund managers began foraging for new types of risk in 2014 as they gained more ground in the property cat reinsurance market.

Participants in the life ILS market are hopeful that volumes of XXX and AXXX reserve financing transactions will be boosted in 2015 after regulators made progress on new industry guidelines this year.

In a memorable year for the cat bond market, 2014 brought forth both the largest ever transaction and the lowest coupon deal amid a number of other milestones.

White Mountains reinsurance subsidiary Sirius has decided to close its ILS fund in 2015 as it turns its attention to developing its quota share business with third-party investors, Trading Risk revealed in late November.

The operational expense base of some of the industry's largest reinsurers equates to about 10 percent of their shareholders' equity, analysis of their 2013 annual results shows.

The catastrophe specialists among the peer group of short-tail Bermudian reinsurers tracked by sister publication The Insurance Insider focused on other business lines to deliver top-line premium growth in the third quarter.

RenaissanceRe CEO Kevin O'Donnell said that the company's $1.9bn bid for Platinum Underwriters last month does not represent a strategic shift but merely a furthering of its existing strategy.

Catlin COO Paul Jardine said at a recent Bermuda Convergence conference that the traditional reinsurance model of writing and keeping risk was no longer appropriate and urged the industry to think more about warehousing and distributing risk.

Amlin will pay an estimated $29.1mn (£18.1mn) to acquire another 35 percent share in London-based fund manager Leadenhall Capital Partners, taking its total stake to 75 percent.

Allianz is preparing to place its EUR1.3bn "SuperCat" treaty at rates that are roughly 10 percent lower for 2015, sister publication The Insurance Insider has reported.

Richard Brindle has interest from private equity houses including Crestview Partners and Pine Brook Partners in his proposed $2bn 2015 start-up, sources have said.

ILS Capital Management generated a 14.9 percent return for the first nine months of 2014, according to an investor report seen by Trading Risk.

Nephila's Juniper fund has returned 7 percent for the first nine months of 2014, with its lower-risk Palmetto fund delivering 5.1 percent over the same period, according to a recent presentation from the Oregon Investment Council.

Canopius expects to recoup $10mn from a marine industry loss warranty (ILW) that will pay out after the total loss reserve for the Costa Concordia sinking nudged past the $2bn threshold, it is understood.

ILS fund manager Eskatos Capital Management has reserved for a potential loss from the Brisbane storms that struck in late November, which is set to cause industry losses of more than $400mn.

Armour Group declined to comment on whether its most recent legacy deal, the acquisition of $390mn of reinsurance for Italian and Spanish medical malpractice reserves written by QBE, was backed by capital from its new ILS Property & Casualty Fund affiliate.

The Swiss Re Cat Bond Global Price Return Index took its biggest fall of 2014 in November.

Prices on American Strategic's Gator Re cat bond dropped by roughly 10 percent in the week following the sponsor's updated loss report, but sources said a wide variation on indicative pricing remains.

New P&C issuances added almost $2bn to 2014 cat bond volumes in late November and early December, putting the year on course to reach a record total.

CatCo Investment Management's chief operating officer and chief financial officer Jason Bibb has resigned with immediate effect, the London-listed firm announced on 12 December.

A UN-led group that is studying new ways of responding financially to humanitarian crises will consider using catastrophe bonds and insurance as a means of transferring risk.

Earlier this week, after breaking the news that Montpelier Re was making overtures to potential bidders, The Insurance Insider editor Mark Geoghegan tweeted that one of our bird-watching colleagues should keep his binoculars handy as it seemed it was "mating season" in Bermuda.

One of the options for up-for-sale Montpelier Re may be to sell its Lloyd's business as a standalone unit and restructure the remainder as a fund manager, sources told sister title The Insurance Insider.

Investors in renewing 2015 sidecars may be looking at projected net returns that have in some cases halved from 2014, Trading Risk understands.

Zenkyoren's latest Nakama Re cat bond has upsized from $200mn to $375mn as pricing on the Japanese quake deal settled at the midpoint of guidance, Trading Risk understands

CatCo Investment Management's chief operating officer and chief financial officer Jason Bibb has resigned with immediate effect, the London-listed firm announced this morning (12 December)