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Cat bond issue reaches record $ 12.8 billion 2021: Swiss Re



New issue in the 2021 real estate / accident bond sector amounted to $ 12.8 billion, surpassing the previous record in 2020 by 13%, said Swiss Re Ltd. in a report on Thursday.

A number of new sponsors including the government of Jamaica also helped drive the record release, and the market is expected to remain robust by 2022.

US wind risks accounted for about 35% of the new issue, followed by multiperil and US earthquake disasters. In 2021, new issues exceeded scheduled maturities, leading to a net inflow of $ 1.8 billion.

Since the end of 2012, the emergency bond market has shown a compound annual growth rate of 9.4%.

Liquidity in secondary markets also helped to strengthen the position of emergency bonds among investors, enabling them to actively trade in and out of positions. The highest volumes of secondary trading took place in May and June, where the last two months of the year also showed increased activity, according to the Financial Industry Regulatory Authority, a non-governmental organization that writes and maintains rules for brokers and broker-dealers. [1

9659002] ] In 2021, the Jamaican government became the first government in the Caribbean region to independently sponsor a disaster relief operation. IBRD CAR 130 will provide up to $ 185 million in coverage for tropical cyclones based on a parametric trigger of atmospheric pressure.

"We have seen a steadily increasing demand over the last decade, with the cat bond market growing by close to 10% per annually, "said Judy Klugman, Head of ILS Sales at Swiss Re, in a statement with the report, adding that she expects" this positive momentum will continue in 2022 "and beyond, as the sector provides real value to both sponsors and investors. . "


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