Willis Towers Watson has tipped that greater focus will be drawn to ILS domiciles and structures in 2020 amid an “unusual amount of innovation” from existing and emerging jurisdictions.
The deal points to a significant price correction in the cat bond market since 2018, with projected spreads up more than 20 percent when compared with past deals.
It will be many months before the $11bn payout agreed between Pacific Gas and Electric Company (PG&E) filters through to the (re)insurance and ILS markets, with this lump sum likely to benefit some parties more than others.
Panellists at Trading Risk’s conference in New York said they were adopting a wait-and-see approach to Lloyd’s Blueprint One proposals intended to make it easier for ILS managers to participate in the market.
Access to risk has been the biggest driver of M&A deals for independent ILS funds, TigerRisk Capital Markets & Advisory co-CEO Jarad Madea said at Trading Risk’s conference in New York last month.
Benjamin Franklin apparently once said that ‘nothing in life is certain except death and taxes’ – and it seems like the adage resonated with the risk modellers of the (re)insurance industry.
Broader risks could entice new investors to the ILS space, Dan Brookman head of alternative capital at Axa XL said at Trading Risk’s conference in New York earlier this month.