Insurance-linked securities (ILS) have become a vital part of the reinsurance industry, providing alternative capital for risk transfer, allowing investors to access insurance risks through financial markets, spread catastrophe risks and enhance market capacity.
The key benefits of ILS are clear: greater diversification for investors, reduced reliance on traditional reinsurance and increased capacity to absorb large losses from natural disasters.
Additionally, ILS instruments such as catastrophe bonds offer more flexible and efficient solutions for insurers, helping to stabilise pricing and provide resilience against major catastrophic events.
But does the market know enough about ILS? We asked a cross-section of re/insurance leaders their opinions about the importance of educating the market on ILS, and here’s what they said.
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