19 November 2012 Alternative Risk Transfer

ILS becomes mainstream option

The use of insurance-linked securities (ILS) by the world’s biggest insurers and reinsurers is increasingly becoming the norm according to two recent surveys – but only if the terms and conditions around the product are competitive compared with more traditional forms of coverage.

A poll of insurers and reinsurers by Guy Carpenter at the recent Property Casualty Insurers Association of America (PCI) conference, found that 16 percent of those polled will utilise alternative capital sources in the year ahead.

But it seems the bigger the company they more likely it is to use ILS. A separate survey by Swiss Re of the biggest insurers in the US found that 13 of the top 20 have used ILS in the past and were considering using it in the future. Even firms that are not using ILS now, say it remains on their radar.

A source at Bermuda based re/insurer Catlin said that the company will consider using ILS if the price and coverage offered a distinct advantage over other forms of protection. “It’s a case of whatever fits best,” the source said.


More on this story

Insurance
1 December 2023   Path to 1.1 looks orderly: European deals are 1/4 to 1/3 in FOTs, ahead of UK & US.
Insurance
29 November 2023   Protectionism is driving efficiencies from the economy, narrowing risk-sharing pots.
Insurance
22 November 2023   Fitch expects a significant recovery in earnings in ’23 and further improvements in 2024.

More on this story

Insurance
1 December 2023   Path to 1.1 looks orderly: European deals are 1/4 to 1/3 in FOTs, ahead of UK & US.
Insurance
29 November 2023   Protectionism is driving efficiencies from the economy, narrowing risk-sharing pots.
Insurance
22 November 2023   Fitch expects a significant recovery in earnings in ’23 and further improvements in 2024.

Intelligent Insurer
Newton Media Ltd
Kingfisher House
21-23 Elmfield Road
BR1 1LT
United Kingdom