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Property cat bond issuance falls in Q1

Posted On: May. 4, 2021 1:57 PM CST


Property catastrophe bond limit placed in first-quarter 2021 declined 31.5% to $2.57 billion compared with first-quarter 2020, according to a report Tuesday from Aon Securities, part of Aon PLC.

This year’s first quarter, however, was still the third-highest, first-quarter quarterly issuance over the past 10 years.

First-quarter issuance consisted of nine property/casualty transactions by nine sponsors with an average deal size of $285 million, compared with 14 transactions by 13 sponsors in first-quarter 2020 with an average deal size of $268 million.

Property catastrophe bonds outstanding increased $450 million to $31.5 billion at the end of the quarter.

Investors appear to favor per-occurrence triggers to aggregate and are “looking to put cash to work,” Aon said.

“We believe that the elevated pipeline will continue in Q2 and Q3 2021,” with the market seeing “positive momentum” for the remainder of 2021.