Gallagher’s Arthur Re gets traction as ILS reaches new heights

As ILS reaches new heights in terms of issuance and innovation, Gallagher Securities is ready for the opportunity, partly through Arthur Re.

Key points:
ILS reaches record levels
Arthur Re gaining traction
Role of broker now key

The use of insurance-linked securities (ILS) as a risk management tool is booming by almost any measurement – including the number of new sponsors and the innovation taking place. But that makes the role of the broker even more important in ensuring clients are making the best decisions on which solutions to leverage when placing risks.

That is what Jason Bolding, CEO of Gallagher Securities and global head of ILS at Gallagher Re, told Monte Carlo Today. He also explained why these forces made it the perfect time to launch Arthur Re, Gallagher Re’s new platform designed to streamline the issuance process for index-based catastrophe bonds.

Arthur Re is a Bermuda-domiciled unrestricted special purpose insurer (SPI) and segregated accounts company. It was established in 2025 by Gallagher Re and Gallagher Securities but was officially launched and first used in June this year for the $150 million Quercian Re cat bond for Oak Global. Since then, it has facilitated two further deals: Tranquil Re for Nectaris Re Ltd., a reinsurer backed by funds from Leadenhall Capital Partners and Woody Re for Fidelis, both worth $75 million.

Bolding said the timing of the launch has been good – and demand is there. “The fact that we have completed three transactions from a standing start demonstrates that there is untapped demand for greater efficiency,” he said.

“We wanted to create Arthur Re to reduce the friction involved in bringing index-based catastrophe bonds to market. Arthur Re has demonstrated that there is demand for simpler, faster and more efficient routes to capital-markets capacity. That is evidence that the market needs these tools to help clients access capital more efficiently and thoughtfully.”

Maturity means innovation

The traction Arthur Re has so quickly gained is reflective of wider trends in this space. The cat bond market had a very strong first half to 2026 with issuance of some $17.5 billion with outstanding cat bonds in the mid-$60 billion range. He suggests the $100 billion mark is on the horizon. But Bolding is quick to point out that it is more than just its size that is impressive.

“We have seen record year after record year; every year seems to be bigger than the last. But beyond the size, what matters is the maturity: there is broader sponsor access and growing investor demand. The story is not just about record issuance; it is about a market that has matured,” he said.

“We have seen more new sponsors come to market every year, and first-time sponsors tend to become repeat sponsors. That is a very good sign for the market's trajectory. To me, that is a sign that the cat bond is no longer just a source of opportunistic capital; it is becoming a core part of sponsors' risk-finance toolkit.”

He also notes that limits are increasing. Many deals now exceed $1 billion and many are also multi-year placements. And hand in hand with this, new territories and perils are coming to the fore. “We are also seeing different structures: cascading structures, particularly around Florida; more aggregate structures; more top-and-drop structures; more multi-event structures, including second-event protection. That is a very good sign for the trajectory of the market.”

He adds that one of the biggest innovations he is seeing is around securitising casualty risks. “Casualty has historically been viewed as more challenging because of longer claims development, social inflation and other factors. But investors are now willing to evaluate casualty exposures when they are structured properly. We are seeing increasing interest in these exposures from asset managers and institutional investors that are seeking both underwriting returns and asset returns as well as diversification.”

The value of advice

Yet more choice means more decisions to make – and this makes the role of the broker more important. As more forms of capital become available, insurers must decide what belongs with traditional reinsurers and what is better suited to the capital markets.

“It is really about finding ways to connect the risk with the right source of capital, whatever that source is,” he said. “That is why there is a real need for a thoughtful broker that looks at the client holistically and asks: what are your needs, and what is the right capital solution for those needs given the dynamics of the market you are trying to address?

“Each solution has positives and negatives. At the end of the day, it is about matching the risk and the dynamics of that risk with the right capital solution. It comes back to the long-term question of how we find ways to connect risks with the right sources of capital. Alternative capital should definitely be part of that discussion when you are thinking about how to manage volatility.”

Jason Bolding is CEO of Gallagher Securities and global head of ILS at Gallagher Re. He can be contacted at: Jason_Bolding@gallagherre.com

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