Trading Risk March 2019

PGGM has hit its target of investing 2.5 percent of total funds in ILS for the first time since it began allocating to the sector in 2006.

As the first quarter drew to a close, cat bond sponsors continued to test the market’s appetite for new deals.

Data on ILS returns from Mercer ranks the industry’s 2018 performance as the second-worst after 2017, and only just better than that of 2011.

Massachusetts Pension Reserves Investment Management (MassPRIM) appears to have lifted its allocations to ILS managers Aeolus and Markel Catco for 2019, despite taking losses in its first year of investing in 2018.

Stone Ridge’s reinsurance interval fund fell to $5.02bn of assets by early March, after an increase in investor redemption requests in its latest quarterly buyback.

Reinsurer-owned ILS managers reported mixed outcomes in terms of assets under management (AuM) in their Q4 results.

The continuing decline in UK life expectancy rates, evidenced by new data updated for 2018, may increase the affordability of pension de-risking, according to experts.

One of the biggest evolutions in the ILS market has been the move away from a hedge fund investor base to a more permanent capital base, according to RenaissanceRe managing director Chris Parry.

Plans to launch a vehicle that is both an ILS fund and insurance transformer are being reviewed by the Guernsey regulator, Carey Olsen partner Christopher Anderson revealed at We Are Guernsey’s ILS reception in London last month.

New registrations are expected from the ILS market.

Massive demand for cyber insurance could be an opportunity for the ILS market to expand, AIG president and CEO Brian Duperreault said at the Sifma IRLS conference in Miami.

Cat bonds are becoming a “primary area of focus” for investors after faring well amid two years of catastrophe losses, AlphaCat CEO Lixin Zeng said at this year’s Sifma IRLS conference in Miami.