ART

"Most people with flood insurance buy policies backed by the federal government’s National Flood Insurance Program. As of April, less than one-sixth of homes in Houston’s Harris County had federal coverage, according to Aon. That would leave more than 1 million homes unprotected in the county. Coverage rates are similar in neighboring areas. Many cars also will be totaled."

"If the NFIP were to approach bond investors, they'd have to confront the dollars and cents of their business model and potentially change the program in politically unpopular ways."

"As early estimates of damages from hurricane Harvey point towards an overall economic impact in the low tens of billions of dollars with flooding likely to have caused the majority, the National Flood Insurance Program’s (NFIP) reinsurance layer looks increasingly at risk of paying out."

"The insurance-linked securities (ILS) market and providers of capital market backed reinsurance capacity can help with the job of narrowing the flood risk protection gap in the wake of hurricane Harvey, according to Rick Miller Managing Director – Co-Head of Insurance Linked Securities at Jardine Lloyd Thompson Capital Markets."

"Insurance industry think tank, the Geneva Association (GA), in partnership with the International Development Forum (IDF), has released guidelines in support of sovereign risk financing and transfer, providing governments around the world with vital risk assessment frameworks."

"This document has been developed in response to a request from the United Nations Office for Disaster Risk Reduction (UNISDR) as part of Words into Action Guideline on National Disaster Risk Assessment: Governance System, Methodologies, and Use of Result. This module provides governments with a framework for risk assessment to support development of sovereign risk financing and risk transfer programmes. It also offers a checklist for conducting the underpinning risk analysis to guide the design of such programmes."

"The World Bank actively working to emulate its successful establishment of the Pandemic Emergency Financing Facility (PEF) for other humanitarian crises, such as famine, including the use of financial market risk transfer instruments, such as the pandemic catastrophe bonds and swaps."

"Following the devastating impacts of hurricanes Irma and Maria in the Caribbean discussion has once again turned to how to secure an increased amount of parametric disaster risk financing for the region, with a regional catastrophe bond issuance rising up the agenda once again."

"The first catastrophe bond covering earthquake risks from the government of Colombia is expected to be launched within a matter of weeks, according to the country’s Minister of Finance and Public Credit, as the country looks to capital market sources to improve its disaster risk transfer and financing."

"The first catastrophe bonds to benefit all four member nations of the Pacific Alliance trade bloc in Latin America is set to increase in size, as the mooted $1 billion cat bond issuance has now had its target increased to as much as $1.39 billion of earthquake risk coverage for the region."

"The World Bank sees the ability of its Treasury to mobilise fixed income capital to fund sustainability as a key piece of its mandate, with disaster risk transfer, in the form of catastrophe bonds, insurance and weather risk trades, seen as important tools to protect against the erosion of specific countries development gains."

"Decentralization means the removal of a middleman or central authority that has to administer trades and bets. As a result, fees are significantly reduced because there’s no third party involvement necessary. Blockchains are trustless environments which mean participants can simply enter a predictive contract without the need of a broker to manage the trade. With a centralized platform, information regarding the prediction market might be withheld by the central authority to give them an advantage over the market participants. With a decentralized system, there is no central authority, and all information regarding the market is publicly available to everyone."

"The federal government of Mexico has cited new “innovations” that improve the coverage of its latest catastrophe, which was secured as part of the World Bank’s $1.36 billion multi-country Pacific Alliance cat bond issuance that completed recently."

"In this eBook leading economists, lawyers, and investors examine the case for issuing GDP-linked bonds, the obstacles to market development, ways of overcoming them, and what such a security might look like in practice."

"The Pacific Catastrophe Risk Insurance Company (PCRIC), a parametric insurance facility for the Pacific Island nations which is supported by the World Bank and others, is hoping to expand its risk pool with the addition of new members and also through the creation of new risk transfer products."

"The crises that erupted in countries like Ireland and Greece a decade ago would not have been so severe had their debt been linked to their economic performance. And the same is true today: Investors around the world will continue to accept the risk, given the unlimited upside to investing in entire economies."

"A life settlements investment fund, Life Settlement Assets PLC, has been listed on the London Stock Exchange’s specialist fund segment this morning, as the manager of the strategy looks to gain access to a broader cross-section of investors through a listed closed-ended vehicle."

“Today, and for the next 18 months, Jamaica is in a Precautionary StandBy Arrangement with the IMF. Within the context of this program with the Fund, we have access to significant resources should we need them. As we move towards the end of this program relationship with the IMF with the commensurate stand-by line of credit that it offers, it is important that we consider measures that can moderate the fiscal impact of natural disasters,” Dr. Clarke said during the speech.

Another first has been achieved by Tremor Technologies, Inc., the programmatic reinsurance risk placement marketplace provider, as the firm priced and placed the first ever programmatic parametric swap transaction in insurance form.

Security First Insurance's $100 million First Coast Re II Pte. Ltd. (Series 2019-1) full 144A catastrophe bond transaction has now been priced and is set for completion.

The four Pacific Alliance countries, Chile, Colombia, Mexico and Peru, are beginning the work alongside the World Bank to identify potential solutions to help them transfer climate related natural disaster risks, including identifying whether further catastrophe bonds would be suitable.

Pension Insurance Corp. (PIC) has completed a pension insurance buy-in with the Trustee of the Marks & Spencer Pension Scheme, insuring around £900 million of its pensioner liabilities. With total liabilities of £10 billion, the Marks & Spencer pension scheme has also entered into another roughly £500 million buy-in with Phoenix Life.

The second catastrophe bond to be issued in the UK for sponsoring French reinsurance company SCOR is set to upsize, as the multi-peril Atlas Capital UK 2019 PLC (Series 2019-1) transaction is expected to reach $250 million.

The latest catastrophe bond to be sponsored by the Texas Windstorm Insurance Association (TWIA), the $200 million Alamo Re Ltd. (Series 2019-1) transaction, is set to price at the mid-point of initial guidance, we’re told.

Alternative reinsurance capital is playing an increasingly important role in the global re/insurance market, according to Swiss Re, which recognises that it has helped to curb volatility in the marketplace and is paying an increasing share of global losses.

American Integrity Insurance Company of Florida, Inc’s newest and third catastrophe bond, the Integrity Re Ltd. (Series 2019-1) transaction, is now targeting up to $75 million in size, with pricing fixed at the top-end of initial guidance

U.S. primary insurer Safepoint’s latest catastrophe bond, the Manatee Re III Pte. Ltd. (Series 2019-1) transaction which is being issued out of Singapore, has shrunk to just $40 million in size, while pricing has been fixed above guidance.

The latest catastrophe bond to be sponsored by French reinsurance company SCOR has now been priced at the lower-end of the raised coupon guidance range, at the upsized amount of $250 million.

The Security First Insurance Company cat bond became the first 144A cat bond to be issued under the new ILS regulatory regime in Singapore, pipping another transaction, the Manatee Re III 2019-1 cat bond. Swiss Re assisted Security First in getting this landmark deal to market.