ILS

Catastrophe bond spreads tightened significantly during the first quarter as pricing "decoupled" from the traditional reinsurance market, said GC Securities in its review of first quarter activity in the insurance-linked securities (ILS) market.

A trio of cat bonds have increased in size as pricing continued to slip below initial forecasts during the marketing process, sister publication Trading Risk has reported.

Some traditional reinsurers are yet to "adapt" to the new reality of significant alternative capacity, be it in the form of cat bonds, sidecars or collateralised reinsurers, according to Aspen Re CEO James Few

Non-traditional capacity is set to put pressure on rates for index-linked and retro products in the second half of the year as un-deployed funds are redirected from the saturated reinsurance market, according to Validus Re CEO Kean Driscoll

"True convergence" has now occurred as plummeting cat bond prices and rates for collateralised capacity have crossed over with traditional capacity, according to Bryon Ehrhart, chairman of Aon Benfield's investment banking group.

Louisiana Citizens Property Insurance is planning to lift its traditional reinsurance cover by about $60mn after buying its new $140mn Pelican Re cat bond, The Insurance Insider understands.  

Pricing of risk transfer through the use of cat bonds has dropped by an average of 37 percent on transactions in the last eight weeks, according to Bryon Ehrhart, chairman of Aon Benfield's investment banking group and chief strategy officer.

Index and retro products are likely to come under pricing pressure in the second half of the year as fund managers scramble to deploy "dead capital" rather than face the ignominy of giving it back to investors, according to Validus Re CEO Kean Driscoll

Lancashire reduced its net Sandy loss to just $28.9mn after agreeing a settlement on an industry loss warranty (ILW) cover that was close to being triggered by Superstorm Sandy

First-time cat bond sponsor American Coastal Insurance Company is seeking to raise $183mn+ from its new Armor Re deal

Ace Ltd has revealed that it will use its debut $95mn sidecar Altair to develop a formal track record and investor relationships in the collateralised space, with a view to upsizing the vehicle should more attractive underwriting opportunities arise

RenaissanceRe has decided not to renew its Timicuan Re Florida sidecar this year, in a further sign that the industry is steeling itself for a tough 1 June renewal in the crucial $3.5bn+ market