Pricing in the catastrophe bond secondary market already implies a lighter hurricane season impact and actual losses are running below expected levels, which leads Lane Financial to estimate expected returns for the cat bond market of around 10.5% in 2025, giving the potential for this to be a third year of double-digit returns in a row.
Back in July, specialist consultancy Lane Financial LLC had said that catastrophe bond pricing remained firmly in the “neutral zone” and it predicted that the market remained on-track for an expected 8.5% total return in 2025.
Fast-forward to the end of the third-quarter and Lane Financial has analysed the state of catastrophe bond market pricing and what that implies, based on secondary market pricing sheet data.
FULL ORIGINAL PUBLICATION HERE