Analysis

Cat bond issuance in H1 at around $8.6bn was almost a match for full-year 2022 volumes at $8.9bn, as the market staged a recovery at a pace that surprised many participants after a challenging second half last year.

Compelling rates are on offer for markets willing to write wildfire risk in the sunshine state.

A Guy Carpenter report recently noted that risk models are converging for the most remote risk levels.

The life segment has shifted from its genesis in mortality and morbidity risk transfer as lapsed risk deals have proliferated.

Most forecasters predict below-average activity in the region – but opposing weather phenomena mean uncertainty is higher than usual.

Even clean accounts in the admitted space are seeing rate increases of 15% year on year, while loss-hit accounts in Florida were slapped with a 100% rate increase for June 1.

Early private deals have provided far more stability in this year’s renewal than last.

Shifts in reinsurance appetite across the risk spectrum has squeezed out ILS providers in some cases.

Softening cat bond rates are among the bearish signals for cat rates, but latent new demand and still-cautious supply should prolong reinsurer gains.

Five counterparties account for almost half of all premiums ceded by a sample of major Floridian carriers, analysis shows.

The pace of rate hikes will ease back from the 1 January reset as buyers seek to lock up capacity early after last year’s dislocated renewal.

UBS previously explored setting up an ILS offering, but instead opted to offer other firms’ products.