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Home / Insurance / ILS, cat bond activity decreases, but forecasts promising: Aon

ILS, cat bond activity decreases, but forecasts promising: Aon



The $8 billion in insurance-related securities issued in the first half of 2022 was down $500 million from last year’s record first half, but the sector shows a “robust” pipeline going forward, according to a report on Tuesday from Aon PLC.

Similarly, for the year ending June 30, 2022, the $12 billion of property/casualty bonds issued was down from $700 million from the previous 12-month period ending June 30, 2021, according to the report.

The average deal size for the first half of 2022 was $234 million across 34 issues, compared to the average deal size of $283 million for the first half of 2021.

Bermuda remains by far the largest issuer domicile in the 1

2 months ended June 30, 2022, with 41 issuances, up from 38 in the 12 months ended June 30, 2021. Singapore accounted for five, down from seven; The Cayman Islands were stable at three and Ireland at two.

During the period, Hong Kong also issued its first disaster bond, spurring optimism for increased activity there. “With sponsors starting to use the regime… the growth outlook for the region and the wider Asian market looks positive for the coming year,” the report said.

The forecasts remain optimistic.

“The ILS market has continued to be supported by new and returning sponsors, providing access to capital even as it faces major headwinds such as the conflict in Ukraine, inflationary pressures and rising interest rates,” Paul Schultz, managing director of Aon Securities, said in a statement with the report. “We expect this momentum to continue through the end of the year.”


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