Trading Risk February 2018

Mercer Investments principal Robert Howie said that single-digit reinsurance rate increases may be attractive to ILS investors given the performance of other asset classes.

Markel Catco's "eye-catching" hike to its wildfire loss reserves in its December monthly report implies that the Californian disasters triggered the firm's "floating back-up" pillars, according to a Numis analyst's note.

Securis and StarStone have agreed a partnership that will expand the ILS manager's US property insurance portfolio, Trading Risk has learned.

Guy Carpenter told Trading Risk that rate increases on retro business ranged from 5 to 25 percent on a risk-adjusted basis, with pricing dependent on loss experience.

The cumulative insured loss number from PCS for 2017 hurricane and wildfire claims now stands at $68bn, with all cat perils in the US totalling $88bn.

Pricing for industry loss warranties is up by 15-30 percent on loss-affected covers, according to figures from brokers, as the market picks up after a slow start to the year.

The strategy of Langhorne Re, the closed-ended life fund set up last month by RenaissanceRe and life reinsurer Reinsurance Group of America (RGA), will be based largely around a leveraged asset play, according to sources.

Fergus Morrison is expected to join the underwriting team at Bermudian ILS manager Aeolus later this year, Trading Risk understands.

AIG's surprise move to take over AlphaCat parent Validus continues the trend for reinsurer-affiliated asset managers to dominate M&A activity within the ILS management sector.

First quarter cat bond issuance has already reached $1.56bn after the World Bank's Latin American earthquake cat bond upsized to close at $1.36bn, according to Trading Risk data.

The 2017 calendar year was the costliest on record for weather events, with insured losses estimated at $132bn, according to Aon Benfield's Impact Forecasting.

Former Novae direct and facultative (D&F) head Nik Lucking is to lead Barbican's new property D&F underwriting platform in Bermuda.