Insight and Intelligence on the London & International Insurance Markets

4 February 2012

ILW rates leap on Deepwater spill

8 July 2010

Buying pressure from dedicated cat fund managers and traditional (re)insurers has spurred increases of up to 70 percent rate on certain industry loss warranties (ILWs) after the Deepwater Horizon oil spill.

Buyers seeking to hedge their energy exposures face rates on line (RoL) of around 20 percent on offshore non-catastrophe marine ILWs with a $1bn industry loss trigger, according to sources.

The cost of similar contracts before the spill in April was about 12 percent RoL.

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