Pension plans eye ILS as investment opportunity


Pension plans eye ILS as investment opportunity

Fifty percent of pension plans state that getting trustees comfortable with ILS is the biggest impediment to allocation. Noel Hillmann, managing director of Clear Path Analysis, takes a look at the findings of a recent survey.

A recent survey of 100 institutional asset allocators carried out by independent publisher Clear Path Analysis, and sponsored by Nephila Advisors and Credit Suisse Insurance Linked Strategies, has found that more than one in five pension plans are considering new investment into insurance-linked securities (ILS) in 2017.

According to the survey, Insurance-Linked Securities—Asset Owner Insight, global market turbulence, macroeconomic and geopolitical events have meant that UK, European and US interest rates have stayed low, resulting in growing numbers of pension funds turning to alternative asset classes to source attractive yields, particularly those offering uncorrelated returns from equity and bond markets.

The survey found that 22 percent stated they were very likely to start investing in ILS in the next 12 months.

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