Catastrophe bond issuance came to just $460 million in new limit during the 2017 third quarter, though the typically slow Q3 added to what remains a record year for the sector, the Property Claims Services unit of Verisk Insurance Solutions said in its latest report.
The new Q3 limit came from two completed catastrophe bonds, and the number brings the year’s total issuance to nearly $9.3 billion, PCS noted. That’s a 148 percent increase over the previous year’s nine-month period.
“Year to date, that’s a record. Of course, with the first half of 2017 representing the busiest full issuance year in catastrophe bond market history, each subsequent transaction pushes the market into record territory,” the PCS report pointed out.
While issuance activity was not particularly noteworthy, PCS said the quarter will be worth watching because of the potential for the catastrophe bond market to see claims in the wake of Hurricanes Harvey and Irma hitting Texas and Florida and then affecting several other states.
During the first nine months of 2017, sponsors completed 13 cat bond lite transactions, raising close to $500 million. Three happened in Q3. Over the same period a year ago, there were 10 cat bond lite transactions completed worth $423 million.
Catastrophe bond issuance for the first half of 2017 brought in nearly $8.8 billion in new limit involving 29 transactions, 21 of which came during Q2, with $6.5 billion in new limit.