Insurance Linked Securities Market grows to $ 93B in 2018: Willis Re

The growth of the ILS (insurance-linked securities) market reached $ 93 billion in 2018, up from $ 88 billion in the previous year, according to the new ILS Market Update from Willis Re, Willis Towers Watson's reinsurance division.

In light of several smaller catastrophic events in 2018 and a meaningful series of catastrophes in 2017, non-life bond issuance remained strong with about $ 9.2 billion in new capital, the report said, in which cat bonds are defined as ILS transactions with meaningful liquidity.

Willis Re noted that 2018 was the second most active calendar year for issuing bonds after the 2017 record of $ 9.7 billion.

Of $ 535 million of bonds issued in the fourth quarter of 2018, $ 125 million of capacity will provide protection against liability for California fires, $ 200 million provides peak protection for multiperil, and $ 210 million provides protection against earthquakes in the US. US (employee compensation).

Demarcation lines within the ILS space are fading according to the report, as ceding companies and intermediaries look at the range of cat bonds, sidecars and other collateralized ILS, to find the best tools to meet specific challenges, to continue to develop and refine new solutions. existing structures.

"We see the convergence of convergence," said William Dubinsky, managing director and head of ILS at Willis Towers Watson Securities.

"The overall ILS figure today is a much more meaningful yardstick for the market than just focusing on the issue of cat bundles and sidecar emissions," he said. "ILS capacity and products grow organically and dynamically as gaps between different products and subsectors fill, and innovation and market needs create new capacity and products." Our confidence in the speed with which new solutions emerge gives us a favorable prospect for ILS. in 2019. "

Source: Willis Re

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