Catastrophe bonds and insurance-linked securities became increasingly embedded in reinsurance programmes in 2025, a trend set to continue as investors increasingly look to long-term allocations to the asset class, executives from Howden Capital Markets & Advisory (HCMA) have explained.
Reflecting on a busy year for cat bonds and ILS in 2025, HCMA explained that, “Investor appetite across reinsurance and insurance-linked securities (ILS) evolved markedly in 2025, as capital continued to flow into the sector amid attractive risk-adjusted returns and growing institutional confidence.”
Over the course of last year’s record levels of issuance, “catastrophe bonds continued their shift from niche to mainstream reinsurance tools,” HCMA stated, with the cat bond reinforced as a core component of reinsurance towers, no longer being viewed as “a specialist alternative.”
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