March 2011/1

Regular cat bond sponsors have been quick to take advantage of favourable fundraising conditions in 2011, with three (re)insurers bringing peak US risk to market in the first two months.

Swiss ILS manager Solidum Partners has renewed and expanded its private cat bond portfolio for 2011, transforming worldwide cat risks into $12.4mn of securities in three separate deals, Trading Risk can reveal.

I'm too young to remember the infamous London smogs of the 1950s, or pea-soupers, as the impregnable clouds of coal, industrial emissions and Thames-borne fog were nicknamed.

The recent influx of pension fund capital into the insurance-linked sector is likely to put further pressure on US wind cat bond spreads this season, taking pricing near to or below traditional reinsurance.

The ILS market may see Australian and New Zealand earthquake bonds as soon as this July, as Antipodean insurers consider including cat bonds in their reinsurance renewals, Trading Risk has learned.