Cat bond investor demand strong
Recent cat bond launches have revealed the extent of investor demand for this kind of risk. This is the view of Tony Ursano, chief executive of Willis Capital Markets & Advisory (WCMA).
Ursano said that there was strong investor demand at present for risk in catastrophe bond form. Thomas Blunck, board member at Munich Re, agrees, saying investor response has been positive
. “Investors still appreciate the transparent risk/return profile and the diversifying effect from cat bonds that are virtually uncorrelated with trends on the capital markets,” he says.
Both comments followed the announcement on Friday of Munich Re’s latest securitisation, the special purpose insurer Queen Street VII Re Limited. The cat bond provides coverage for US hurricane and European windstorm risks with a total volume of $75 million, and WCMA acted as the sole book runner for the deal.
French reinsurer SCOR announced today that it has placed Atlas Reinsurance VII Limited, which will provide twofold protection of $60 million against US hurricanes and earthquakes, and €130 million against European windstorms.
