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The sidecar has been taking on more cyber risks in recent years, sources said. -
Their view that “investors have never had it so good” speaks of a market in an upbeat mood as of January.
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Potential rotation of the investor base, along with continuing evolution in ESG and non-cat products, are set to be themes for the upcoming year.
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Key themes of the renewal that resonated across the ILS investor base include the elevation of attachment points, though lack of take-up of named perils coverage may disappoint some.
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Cedants are grappling with rising rates while coverage narrows.
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The market is characterised by rising prices and shrinking deal sizes as investors pick and choose over which bonds to back.
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Tension is emerging at the reinsurance level over the retrenchment from all-perils coverage, which previously offered ‘sleep-easy protection’.
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The European cat market is hardening faster than expected but the process is being delayed by ongoing negotiations over retro protection and varying lists of reinsurer demands to improve terms.
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Hurricane Ian’s legacy will undoubtedly lead to some shake-ups in the ILS sector, with ongoing progression outside cat and ESG strategies likely to be a focus.
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Investors are in the driving seat and able to ask for improvements such as higher extension spreads.
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Expansion is set to be a trend across Lloyd’s as syndicates look to capitalise on a hardening market.
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Initial loss estimates for the last quarter show lower hits to equity than observed after hurricanes Harvey, Irma and Maria five years ago.
