Posted on 20 May 2013 by Neilson
The first quarter of 2013 saw $1.6 billion of new issuance non-life capacity marketed through five catastrophe bond transactions, including three transactions marketed in the first quarter and closed at the beginning of the second quarter, according to Willis Capital Markets & Advisory (WCMA), part of Willis Group Holdings, the global risk advisor, insurance and reinsurance broker.
This compares with eight deals and a total of $1.3 billion in new non-life capacity in the first three months of last year, said WCMA in its most recent 'Insurance Linked Securities' (ILS) report, available here.
The new capacity is coming from two sources: new inflows to existing ILS specialists coupled with the return of generalist investors, according to the report.
WCMA added that it expects the catastrophe bond pipeline to convert into a record issuance over the course of the rest of the year.
"After a slow start, 2013 is roaring forward with a flurry of cat bond, sidecar, and collateralized reinsurance activity," commented Bill Dubinsky, Head of ILS at WCMA. "Collectively, capital markets insurance capacity significantly outsizes the surplus of the leading non-life reinsurers, excluding Berkshire Hathaway. Meanwhile, almost all major Bermuda reinsurers, except one, have third party capital initiatives in place. We may be witnessing the moment when the capital markets have moved from the sideshow to the main tent."
Willis Group Holdings plc is a leading global risk advisor, insurance and reinsurance broker. With roots dating to 1828, Willis operates today on every continent with more than 17,000 employees in over 400 offices. Willis offers its clients superior expertise, teamwork, innovation and market-leading products and professional services in risk management and transfer. Our experts rank among the world's leading authorities on analytics, modelling and mitigation strategies at the intersection of global commerce and extreme events. Find more information at our website, www.willis.com, our leadership journal, Resilience, or our up-to-the-minute blog on breaking news, WillisWire. Across geographies, industries and specialisms, Willis provides its local and multinational clients with resilience for a risky world.
About Willis Capital Markets & Advisory
Willis Capital Markets & Advisory, with offices in New York and London, provides advice to companies involved in the insurance and reinsurance industry on a broad array of mergers and acquisition transactions as well as capital markets products, including acting as underwriter or agent for primary issuances, operating a secondary insurance-linked securities trading desk and engaging in general capital markets and strategic advisory work.
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