At the S&P Global Ratings briefing in Monte Carlo at the RVS, Maren Josefs, Credit Analyst at the company explained that the big stories in insurance-linked securities has been catastrophe bonds and casualty sidecars this year, but she cautioned the market to remember that investors still don’t like surprises.
Josefs explained the ILS market backdrop, “What we’ve seen over the 30-year evolution of the market, more and more voices are now saying that it’s actually part of the strategic risk management for cedents, and that they use it as a supplement to their existing reinsurance programmes and to manage the cycle more efficiently.
“This third-party capital gives cedents greater flexibility and it creates opportunities to seek growth opportunities and manage volatility on their balance sheets.”
How supply meets demand remains critical though and in recent years both sides of that equation have been firing on all cylinders, helping to fuel the growth seen in ILS.
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