ILS new issuance jumps to record volume in 2023: Swiss Re
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New issuance of insurance-linked securities soared 63% in 2023 to a record volume of $15.4 billion as the birth of the cyber catastrophe bond introduced a new peril to the market.
Last year’s record issuance was also 20.3% higher than the previous record new issuance set in 2021, according to a report Monday from Swiss Re Ltd.
Fourth-quarter new issuance of $5.1 billion was a record for the period and was 66% higher than the five-year average, fourth-quarter new issuance, the report said.
December 2023 new issuance of $3.37 billion topped the previous monthly record of $3.35 billion set in May 2017, and was nearly double any previous December issuance.
Market activity was bolstered by 13 new sponsors, including the North Carolina Farm Bureau with its $400 million Blue Ridge Re for coverage against U.S. wind. Returning sponsors included Chubb Ltd. and the Republic of Chile, with $350 million of Chile earthquake protection.
The ILS market saw a new peril in 2023 as the first securities securing coverage for systemic cyber threats were issued as Beazley PLC and Axis Capital Holdings Ltd. both came to market.
Swiss Re also issued a cyber cat bond, securing $50 million of protection against systemic cyber events in the United States through its Bermuda-based Matterhorn Re Ltd.
“The emergence of the cyber ILS market has broadened the diversification of the asset class and provided a new arena for cyber writers to support their capital needs,” Swiss Re said in its report.
