November 2014/1

Ace CEO Evan Greenberg said that the insurer is prepared to take a lead in changing the way the industry transfers risk, as risk originators consider the possibility of cutting out the wholesale reinsurance market to go direct to capital providers.

Texas-based hedge fund HBK Investments has cautiously returned to investing in the ILS market, after pulling back from reinsurance in the wake of the financial crisis, sources said.

No hurricane options in 2014; Life expectancy changes to drive pension de-risking

Secondary market prices of extreme mortality bonds have remained static despite the spread of the Ebola virus in west Africa, as bondholders do not view the disease as a material risk to the deals, market sources noted.

Cat bond trading activity on the secondary market picked up significantly in the past month as the typical third quarter lull in new cat bond issuance extended into Q4, ILS traders said.

A raft of bonds are set to mature in January 2015, removing over $2.4bn in cat bond risk from the market.

AlphaCat's new BetaCat fund will be charging investors a management fee of 25 basis points (bps), setting a new low within the ILS market, Trading Risk understands.

Do other industries talk about pie as much as the reinsurance sector?

The primary US insurance market could open up greater potential volumes of business to the growing ILS sector but there are several challenges ahead for funds trying to access this market.

All three of the top Japanese insurers are set to be active in the ILS advisory sector, as Mitsui Sumitomo and Sompo's asset management subsidiaries prepare to follow their peer Tokio Marine into the business.