There’s more evidence that catastrophe bond issuance hit record territory again during Q1.
This time, Aon Securities and a division of Willis Towers Watson are making the call, after a Verisk arm did so earlier in April.
The Aon Benfield division’s latest report on the matter said catastrophe bond issuance reached $2.2 billion during the first three months of 2016, reflecting a new first-quarter record for insurance linked securities,
The issuance covers 10 transactions, and is 31 percent higher than the previous record set during the 2015 first quarter, according to the report. There’s one life transaction, via Aetna Life Insurance Company.
Another record from Q1 – outstanding catastrophe bonds stood at $25 billion as of March 31.
Similiarly, Willis Capital Markets & Advisory said the first quarter of 2016 produced new issuance volume of $2.0 billion of non-life capacity. Willis dubs this a record, noting capacity was issued through 9 transactions and 13 tranches. The total is up 35 percent over Q1 2015’s $1.5 billion in 7 deals, and all the first quarter issuances were sponsored by repeat sponsors, Willis said.
Both Aon and Willis track closely with a new report from the Property Claim Services Unit of Verisk Risk Insurance Solutions, which found catastrophe bond issuance hit $2 billion during the 2016 first quarter. The report also dubbed the results as historic, and tracked the number as a 35 percent jump from the 2015 first quarter, when total cat bond issuance landed at $1.5 billion. Average transaction size also climbed approximately 5 percent higher, PCS said.
The Aon Securities report said all sponsors of Q1 2016 bond issues were repeat issuers, “exemplifying the consistent value offered by the alternative capital market to insurers and reinsurers.”
Source: Aon Securities/Aon Benfield, Willis Capital Markets & Advisory