June 2011/1

Despite opening the year with "optimism and swagger," the cat bond market was cut down to size by the new RMS hurricane model in Q2 as new issuance was stalled by pricing uncertainty, according to broker Willis.

European exposure and loss collator, Perils AG, has added Norway and Sweden to its coverage, completing the suite of countries potentially exposed to a European windstorm.

Ratings agency AM Best has downgraded $175mn of Flagstone Re's Montana Re 2009 US wind and quake cat bond, in light of higher attachment probabilities under RMS's new Version 11.0 US hurricane model.

Tom Skwarek, managing director of corporate strategic solutions at Swiss Re, is leaving his role after 12 years with the global reinsurer.

Risk modeller RMS released its latest Europe windstorm model today (12 July), introducing three new countries to the model and increasing risk profiles in most regions.

Outstanding cat bond capacity fell to $11.5bn in Q2 2011, marking its lowest ebb since the final quarter of 2008 and the height of the financial crisis.

The California Earthquake Authority (CEA) board has approved a $150mn single peril cat bond to be issued via a Bermudian reinsurer, Trading Risk can reveal.

French-headquartered reinsurer Scor has issued EUR75mn of new shares as its contingent capital deal with investment bank UBS is triggered on rising first-quarter catastrophe loss estimates.

Broker Towers Watson Capital Markets (TWCM) has structured and sold its first cat bond deal, an $11.95mn private placement for a Floridian insurance company.

French-headquartered reinsurer Scor will draw down the first EUR75mn tranche of its contingent capital credit line from investment bank UBS after lifting its first-quarter catastrophe loss estimates by EUR10-15mn.

Guy Carpenter has said that if the demand for industry loss warranties (ILWs) is sustained then prices look set to reach an all-time high.

Non-marine retrocession rates have risen by between 10 and 25 percent since losses from March's Japan and New Zealand earthquakes hit capacity providers, according to global broker Willis Re.

Swiss investment manager Twelve Capital has secured a $150mn ILS mandate from Denmark's largest occupational pension fund.

London-based ILS manager Leadenhall Capital Partners has raised another $50mn from investors, compounding an earlier $50mn June inflow and taking total assets under management to $210mn.

Ratings agency Standard & Poor's (S&P) has downgraded American Family Mutual 's Mariah Re 2010-1 cat bond as the loss tally from May's Joplin tornado reached 88 percent of the $300mn attachment point on the notes.

Elementum Advisors founding principal Tony Rettino was named Outstanding Contributor of the Year at the Trading Risk awards dinner in London last night (23 June).

A group of 200 convergence market luminaries gathered in London last night (23 June) to celebrate and reward the skill, innovation and vision so evident in this sector at the Trading Risk Awards 2011.

First-time cat bond issuer Argo Group has described its $100mn Loma Re transaction as the most efficient way to expand its reinsurance and retro programmes ahead of this year's US wind season.

Clariden Leu shuts doors to cash influx; Alternative beta for Australian fund; Greenlight reports lossTraymar courts private equity for $100mn life settlement fund

A handful of small to mid-sized European ILS fund managers have succeeded in riding the wave of interest in insurance-linked investments by raising over $250mn in recent weeks, Trading Risk can reveal.

In a similar reaction to that of the traditional markets at the busy June and July renewal season, the impact of the model changes in the convergence sector appears to have been muted.

The Massachusetts state wind pool and Hannover Re, among other (re)insurers, rejected the ILS market in favour of competitive traditional offers at the mid-year renewals.

Collateralised reinsurers wrote around one third of the $550mn reinsurance programme bought this June by Florida's state-backed insurer Citizens, Trading Risk understands.

Cat underwriters were broadly satisfied at the Florida-dominated 1 June reinsurance renewals, with average risk-adjusted rate rises calculated to be in the 10-15 percent range, according to analysis from sister publication The Insurance Insider.