Trading Risk September 2019
ILS proposals must add value, Lloyd’s CEO John Neal said as he discussed which ILS priorities are quick wins and which are on the back-burner.
The tone of discussions when the hurricane had a projected Florida landfall highlights the precarious nature of the reinsurance market’s current stability.
There’s no doubt that the stress of a serious hit from Hurricane Dorian to Florida reinsurers will add age lines to the ILS market.
Sidecar sponsors may turn more to the private market in 2020 and face continued pressure on terms as capacity is expected to remain tight for pro rata support, according to experts.
Fourteen cat bonds with a combined value of $1.18bn are expected to be a full loss following 2017 and 2018 losses, Trading Risk understands.
The threat will give the market a chance to expand and increase rates, the analysts said.
Danish pension fund PKA is to close its ILS strategies and will no longer have any investments in the sector at the end of 2019, a spokesperson for the fund told Trading Risk.
The North Yorkshire Pension Fund upped its ILS investments while the BBC Pension Scheme pulled back.
UK pension funds are acting quickly to get longevity swaps over the line by the 31 October Brexit deadline.
The brouhaha over trapped ILS capital has led to the question of whether alternative collateral management solutions will emerge.
Markel and Pimco updated the market on their ILS plans.
Trading Risk looks at the dominant themes that the ILS market will be discussing at the 63rd Monte Carlo Reinsurance Rendez-Vous in September.
ILS funds posted gains in June and July, clawing back four consecutive months of declines, according to the Eurekahedge ILS Advisers Index.
M&A activity has made analysing structural conflicts in ILS platforms harder but winners may be those that offer a range of means of access to risk, consultants say.
Lloyd’s CEO John Neal said that cutting back the number of “lead” underwriters in the market would be key to paring overall operating costs.
The handful of reinsurers to disclose third-party fee income lifted this source of earnings by almost a third year on year in the second quarter.
Most reinsurers lifted their exposure to major cat losses heading into 2019, with net written premiums rising further early this year, ratings agencies noted.
People moves in the ILS market September 2019.