July 2013/1

Claire Souch, vice president of Model Solutions at RMS, explains the vision behind the RMS(one) platform and what changes the company believes it can make to ILS fund managers and reinsurer underwriting teams

Assurant sourced a fifth of its per-event reinsurance programme from the capital markets as it expanded the cover by 20 percent at the 1 July renewals

Australian insurer Suncorp renewed its $5bn catastrophe reinsurance treaty at a risk-adjusted rate reduction of around 5 percent, sister publication The Insurance Insider reported

The liquidators of tornado cat bond Mariah Re have sued sponsor American Family Mutual Insurance and service companies PCS and AIR Worldwide, claiming that the trio conspired to bring about a $100mn payout of the bond based on a falsified loss report.

Natural catastrophe events caused some $13bn of insured losses in the first half of 2013, just over half the 10-year H1 average of $22bn, according to new Munich Re NatCat estimates

Cat bond sponsors used Property Claims Services (PCS) data on seven new issuances worth $1.6bn in the first half of 2013, which was in line with volumes placed in the first half of 2012.

A battle to maintain market share at the 1 July renewals kept up pricing pressure on US property catastrophe reinsurance business, according to the major brokers

The Chicago Mercantile Exchange (CME) cleared a trade of 750 seasonal hurricane options representing $7.5mn of notional limit in May in the first deal to date in 2013, according to information from the exchange.

2013 is shaping up to be the strongest year for cat bond activity in six years, with a record-breaking $4bn of new issuance having been brought to market by the end of June - topping the $3.8bn issued in the first half of 2007

Trading Risk's list of investors in the ILS market

Montpelier Re's listed Blue Capital Global Reinsurance fund has been picked as a favourite by JP Morgan Cazenove analyst Matthew Hose because of the resources provided by its parent company.

Brokers have increased their grip on cat bond distribution in the past couple of years, according to statistics compiled by Trading Risk

First half returns among ILS fund managers are slightly behind last year's performance over the same period, according to results from a group of seven cat bond funds tracked by Trading Risk.

The spate of new cat bond issuance in June helped boost trading activity on the secondary market as the US hurricane season started.

The number of unrated cat bonds has increased sharply in 2013 as sponsors forego the expense of seeking a rating

More than $1bn of new issuance has been marketed in the past six weeks in a hectic start to summer for the ILS market, with four new bonds confirming Trading Risk's prediction last month that a flurry of deals was about to emerge.

ILS fund managers have perhaps never faced a more challenging time to keep their capital inflows in pace with investment opportunities, despite making significant inroads into the property catastrophe reinsurance market and with ILS issuance on track for a bumper year

The London-listed Blue Capital Global Reinsurance Fund has deployed $144.7mn through the Blue Water Master Fund, equivalent to 97 percent of its net proceeds.

Bermuda's minister of economic development Grant Gibbons says that helping to build on momentum in the ILS market is an important part of government plans to boost the island's economy

AlphaCat, the managed funds division at Bermudian reinsurer Validus, will take an $0.1mn loss from the flooding in Central Europe in May and June while Swiss ILS fund manager Eskatos reported "limited" reserves for potential claims.

Capital market interest is pouring into the facultative markets as it has into property catastrophe markets, said GC Fac's head of US facultative risk John Trace, at a recent roundtable hosted by sister publication Inside FAC.

Judy Klugman was named the Outstanding Contributor of the Year at the Trading Risk Awards 2013, held at London's Globe Theatre in June

After a runaway first half for cat bonds, talk about "decoupling" from the reinsurance markets is one of the themes of 2013 as capital market participants take the lead in setting their own pricing.

Citi and Pension Insurance Corporation (PIC) have executed the largest ever pension insurance buyout in a deal covering £1.5bn of liabilities and 20,000 members of the EMI group pension fund