A renewed interest in catastrophe bonds is being seen across the insurance-linked securities (ILS) market, as spreads have started to become more “attractive”, which indicates a favourable market entry point for new sponsors, according to Sandro Kriesch, Head of Insurance-Linked Securities (ILS), and Sophie Worsnop, Assistant Vice President, Acrisure Re Corporate Advisory & Solutions (ARCAS).
The reinsurance broker recently conducted a study, exploring how spreads for cat bonds that were issued throughout 2024 have gone on to develop, however the firm primarily focused on just US wind exposed bonds.
“As 2023 calendar year closed, final spreads exhibited a slight upward tendency in comparison to the initial spread guidance, indicating an anticipation of a hard underlying market,” Kriesch and Worsnop said.
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