August 2013/1

AM Best placed SAC Re's ratings on review with negative implications after it emerged that the Bermudian reinsurer's backer SAC Capital Advisors is facing criminal charges in the US

New fund inflows top $2.5bn in Q2; Blackstone picks Nephila; TWIA behind Kane's debut cat bond; Sale process continues at Towers Watson

Switzerland-based ILS fund manager Twelve Capital has completed what it believes is the first collateralised participation on a terrorism excess-of-loss retrocession programme

Broker Optex Group has launched a new Lloyd's Calendar Year Combined Ratio Index, which it hopes will provide investors with a new point of access to the London market. Optex director Andrew Martin explains the proposition.

Switzerland-based ILS fund manager Solidum Partners has expanded its private cat bond portfolio for 2013, transforming regional US hurricane risk into $71.45mn of securities in three separate deals, Trading Risk can reveal

Earlier this summer, AIR Worldwide officially launched Touchstone, a new catastrophe modelling platform designed to provide users with a deeper understanding of their risk exposures, continuing the trend for major modellers to compete by providing software solutions as well as science.

Independent (re)insurance broker BMS has appointed former Aon Benfield executive Romulo Braga to lead its new capital markets division BMS Capital Advisory in the US

RMS has said the Version 13 (V13) update to its Atlantic hurricane model showed that there was a 20 percent chance that US landfalling hurricanes could produce a storm surge loss that was greater than the wind-related impact.

Listed ILS fund DCG Iris reported an active month for cat bond trading in June as it moved out of several positions in order to lock in mark-to-market profits, according to its latest monthly report

The Aon Benfield All Bond ILS index posted a 12.14 percent return in the year to 30 June 2013, which was substantially higher than the index's long-term average and outperformed all fixed income benchmarks.

Mutual funds are likely to increase their role in the ILS market in the future, Aon Benfield Securities predicted in its 2013 review of the sector.

The robust pipeline of new cat bonds issued in 2013 led to high levels of trading on the secondary market during July, with some light trading continuing in the typically quiet month of August, sources said

As ILS premiums tumbled in the first half of 2013, market commentators described the phenomenon as a "decoupling" of cat bond prices from the traditional reinsurance market.

Luxembourg-based life insurer Atlanticlux is looking to issue a value of in-force (VIF) life insurance securitisation through a $100mn insurance-linked Sukuk, or Islamic bond programme, according to Fitch

Opportunistic retro purchasing helped many (re)insurers cut back their exposure to major catastrophe events as they headed into the peak North Atlantic windstorm season.

Two new sponsors entered the cat bond market this summer after being hit by Sandy losses last year as US-focused issuance continued into late July

Two new diversifying cat bonds are expected to be snapped up by investors as specialist ILS funds seek to balance their peak portfolios of US wind risk

Reinsurers kept up the pace of progress in their capital markets divisions during the summer, as Monte Carlo marks a key make-or-break point for new vehicles before the 1 January 2014 renewals.

The volume of industry loss warranties (ILWs) placed in the first half of 2013 fell by about 15-20 percent from 2012, Aon Benfield Securities estimated

Using Bermudian segregated accounts companies (SACs) to issue private cat bonds should provide sufficient protection for investor assets, in spite of concerns over whether foreign jurisdictions would recognise the ring-fencing of assets and liabilities, according to legal experts.

Lloyd's granted Nephila's Syndicate 2357 formal permission to begin underwriting on 2 August and the fund manager is planning to cede business into the syndicate before the end of the year, Trading Risk understands

Berkshire Hathaway has returned to the life settlements market for the first time since 2006 as it completed the $60mn purchase of a portfolio with a face value of $300mn.

Summer is supposed to be a time when the reinsurance market can kick back after settling the mid-year renewals before gearing up again for the madness that is the annual Monte Carlo Rendez-Vous

Controversial proposals put forward by the Securities and Exchange Commission (SEC) to tighten regulation on money market funds (MMFs) are unlikely to have any impact on cat bonds, according to an ILS legal expert.