BI’s Article search uses Boolean search capabilities. If you are not familiar with these principles, here are some quick tips.

To search specifically for more than one word, put the search term in quotation marks. For example, “workers compensation”. This will limit your search to that combination of words.

To search for a combination of terms, use quotations and the & symbol. For example, “hurricane” & “loss”.

Login Register Subscribe

$5.9B in 2012 cat bond issuance not enough to meet demand: Willis


Despite issuance volume of $1.9 billion in the fourth quarter of 2012, the supply of catastrophe bonds was insufficient to meet investor demand, according to a report issued Thursday by Willis Capital Markets & Advisory.

The report, “ILS Market Update: Strong 2012 Issuance Signals Growth,” notes that while the $5.9 billion of catastrophe bonds issued in 2012 represent a 37% increase over the volume issued in 2011, surging investor demand for insurance-linked securities triggered bidding wars on some bonds.

“Most ILS investors were hoping that early December would be full of new issuances as it had been historically,” Bill Dubinsky, head of ILS at WCMA said in a statement. “However they were disappointed to have fewer bonds than necessary to meet their cash inflows. We believe investors will anxiously welcome the new issuances that are in the pipeline.”

According to the report, U.S. hurricane risk continues to be the leading catastrophic natural peril being securitized and sold in the capital markets, accounting for 71% of outstanding cat bond limits.

WCMA, a unit of London-based Willis Group Holdings P.L.C., said it sees ongoing growth in the ILS market, predicting that between $6 billion to $7 billion worth of bonds covering natural catastrophe risk will be issued in 2013. “We see no signs that this growth will slow down in 2013,” the report states. “Pension funds, endowments and life insurers are continuing to increase their allocations to alternatives, especially those that performed well during the financial crisis and the insurance risk sector is a major beneficiary.”

Read Next