The insurance-linked securities market is looking forward to 2017 with cautious optimism after recovering from a rollercoaster of a year in 2016, according to Paul Schultz, CEO of Aon Securities.
“While 2016 started well, with a first quarter of record issuance, the second quarter was more quiet, before a recovery in the third and fourth quarters,” said Paul Schultz, CEO of Aon Securities.
Figures supplied by Aon show that in 2015 actual bond issuance came to $6.9 billion and that 2016’s projected bond issuance was $6.04 billion, something of a downturn after several years of record insurance-linked securities (ILS) issuance.
“What we’ve really seen, starting in the third quarter of 2016 and now certainly manifesting more in the fourth quarter, is a repricing of the capital market product, which is now much more competitive compared to other alternatives than earlier in the year,” Schultz explained.
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