Recent estimates suggest that insured losses from the Los Angeles, California wildfires could be higher than anticipated. As a result, catastrophe bond prices are showing signs of weakness, with the market’s benchmark recording its first-ever negative January return since its inception over two decades ago, according to cat bond fund manager Icosa Investments AG.
With a performance of approximately -1% for January 2025, this marks the twelfth-worst monthly return on record the cat bond market has ever seen.
As we reported last week, reinsurance firm RenaissanceRe is basing its estimate from the wildfires on a $50 billion industry loss event, while global re/insurer Chubb also seems to be working from a relatively high industry figure too.
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