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This paper proposes an individual longevity bond, a combined investment and insurance product to allow individuals to flexibly manage their longevity risk. The bond is a post-retirement product that combines a lifetime income along with a flexible death benefit to meet bequest and liquidity needs. The longevity bonds are issued through a special purpose vehicle which is fully collateralized with a fixed interest portfolio. We apply financial and actuarial models and techniques that provide transparent pricing for interest rate and mortality risk, the construction of optimally immunized bond portfolios and the determination of a loading and solvency margin for systematic longevity risk. We also quantify the natural hedging benefits of the individual bond cash flows arising from the flexible inclusion of both survival dependent income benefits and mortality dependent bequest benefits payable on death.

Price guidance for the New York Metropolitan Transportation Authority’s (MTA) new catastrophe bond has been increased after investor’s fed back that the initial coupon was not sufficient, we’re told, with the parametric MetroCat Re Ltd. (Series 2020-1) cat bond transaction now offering a higher return.

Several of the eight UK bulk annuity providers have high exposures to BBB-rated fixed income assets, loans, mortgages and property. Widening credit spreads, a result of the Covid-19 pandemic, are currently fuelling a buyout bonanza for well-positioned DB schemes. But a longer recession and credit downgrades could affect some insurers’ ability to sustain huge volumes of new business in the medium term. Downgrades could cause ‘fallen angel’ companies to drop from investment grade to high yield, meaning insurers may have to divert new capital to maintain their position under the Solvency II regime.

Hiscox Group, the Bermuda headquartered re/insurer, has acquired additional retrocessional reinsurance protection against peak catastrophe risks with a $100 million slug of industry loss warranty (ILW) based protection secured in advance of the all-important hurricane season.

The New York Metropolitan Transportation Authority’s (MTA) new MetroCat Re Ltd. (Series 2020-1) catastrophe bond has now been priced, but at the top-end of the revised guidance after investors sought a higher return for the risk, with the deal also sticking at $100 million in size.

California’s not-for-profit residential earthquake insurer the California Earthquake Authority (CEA) is hoping to significantly upsize its latest catastrophe bond issuance, with the Sutter Re Ltd. (Series 20201- & 2020-2) issuance now targeting up to $700 million of reinsurance protection.

A.M. Best said that varying pandemic related impacts are to be expected for the insurance-linked securities (ILS) market, with the most concerning likely the fact that collateral could be trapped for years given the significant uncertainty over potential losses.

The Texas Windstorm Insurance Association (TWIA) is likely to target $200 million or perhaps greater of protection from an Alamo Re II Ltd. catastrophe bond issuance for 2020, as the capital markets look set to continue playing an important role in its reinsurance program.

The targeted issuance size for the latest catastrophe bond to be sponsored by the California Earthquake Authority (CEA) has risen again, with the Sutter Re Ltd. (Series 20201- & 2020-2) issuance now aiming for as much as $740 million of reinsurance protection for the sponsor.

USAA has returned to the catastrophe bond market for its first issuance of 2020, with a currently $100 million plus sized Residential Reinsurance 2020 Limited (Series 2020-1) transaction seeking multi-peril reinsurance protection, that will become the insurers 35th cat bond issuance if successfully completed.

Renaissance Re, the Bermuda-based reinsurance underwriter and manager of increasing amounts of third-party capital, believes that Covid-19 uncertainty means “substantial amounts of collateral will be trapped” at the end of 2020, the firms CEO Kevin O’Donnell has said.

Catastrophe bond and related insurance-linked securities (ILS) market activity remains buoyant despite the impacts seen from the Covid-19 pandemic, with primary issuance already reaching $6.1 billion in 2020, according to Artemis’ Deal Directory data.

"The Co-operative Pension Scheme has completed a £350m buy-in with Aviva, taking its total transactions this year beyond £2bn, as defined benefit schemes look to capitalise on cheaper deals amid the coronavirus pandemic."

Analytics company IHS Markit has entered into two bulk annuity deals with Legal & General, the insurer’s first global transaction. The deals, one each in the US and the UK respectively, are worth £116.2m in total, covering 1,350 scheme members.

The USAA Residential Re 2020-1 cat bond deal documents include an exclusion clause to give investors comfort that no pandemic coverage could be forced under the reinsurance protection the Residential Re 2020-1 catastrophe bond will provide to USAA.

In a clear sign of ILS fund demands for higher returns from underwriting catastrophe risks in the Florida reinsurance market, pricing for Florida Citizens’ new $300 million Everglades Re II Ltd. (Series 2020-1 & 2020-2) catastrophe bond has leapt significantly above the top-end of guidance.

Governments should seek a full, candid view of the critical risks to which their jurisdiction is exposed, regardless of whose responsibility it is to manage them and the challenges of aligning on, and implementing, an effective response. But establishing how to prioritize risk management initiatives, particularly across sectors, can be difficult. A new report from Marsh & McLennan Advantage, Building National Resilience, explores how countries can build frameworks to assess a variety of intersecting, nation-level risks, including stretched health systems, technology governance struggles and biodiversity loss.

The collateralised reinsurance sidecar market and private quota share transactions entered into by insurance-linked securities (ILS) funds and investors may face the highest impacts from Covid-19 pandemic related claims, A.M. Best has said.

Cayman Islands based reinsurance company Oxbridge Re Ltd. is aiming to upsize its fully collateralized reinsurance sidecar vehicle Oxbridge Re NS Ltd. for the coming underwriting year from June 1st.

A new catastrophe bond sponsor is coming to market in the shape of Fidelis Insurance Holdings Limited, the specialty insurance and reinsurance firm launched by Richard Brindle, which has launched its first transaction, a $100 million Herbie Re Ltd. (Series 2020-1) multi-peril cat bond deal.

Florida’s Citizens Property Insurance Corporation has now pulled the largest $200 million tranche of Coastal Account linked notes from its Everglades Re II Ltd. (Series 2020-1 & 2020-2) catastrophe bond issuance, leaving just a $100 million tranche being marketed.

On April 8, the European Commission launched a consultation on sustainable finance. Among other things, it asks whether the European Union has a role to play in supporting the development of alternative financial products such as catastrophe bonds, that help in protecting against and hedging financial losses stemming from climate- or environment-related events.

Allstate’s top-end target for its latest catastrophe bond transaction has been lifted to as much as $200 million, while at the same time price guidance for the Sanders Re II Ltd. (Series 2020-2) cat bond deal has been lifted to the top-end of initial guidance.

RKH Reinsurance Brokers, a division of the Hyperion Insurance Group and parametric risk transfer and technology focused managing general agency (MGA) Descartes Underwriting have completed a wind risk trade for a European asset owner, using the AkinovA platform.

NN Life, part of the Nationale-Nederlanden (NN Group), has secured reinsurance arrangements with leading reinsurers Canada Life, Munich Re and Swiss Re to transfer all of the longevity risk associated with some EUR 13.5 billion of pension liabilities from the Netherlands.

Peak Reinsurance Company Limited (Peak Re), the Hong Kong headquartered, Fosun backed global reinsurer, has sponsored another collateralised reinsurance sidecar transaction, featuring a single $12.32 million tranche of notes that were issued by the reinsurers Lion Rock Re Ltd. special purpose vehicle.

“Based on current market conditions as a result of COVID-19, Florida Citizens has decided not to place the Series 2020-1 capital markets risk transfer for the Coastal Account. The capital markets are currently disjointed, fragmented and expecting irrational returns."

The awaited new catastrophe bond issuance from the Texas Windstorm Insurance Association (TWIA) has now been launched to the cat bond investment community, with a $200 million target for the Alamo Re II Ltd. (Series 2020-1) transaction.

The trustees of the Old British Steel Pension Scheme are considering a buyout for its 31,000 members, due to a better-than-expected funding position achieved while in the assessment period at the Pension Protection Fund. While the majority of the British Steel Pension Scheme’s members opted to transfer to a new scheme created in 2018, the remainder stayed at the old scheme, which entered an assessment period at that time.

Florida focused insurer Avatar Property and Casualty Insurance Company has returned to the catastrophe bond market for what will be its second ever issuance, with a currently $65 million Casablanca Re Pte. Ltd. (Series 2020-1) transaction to provide named storm reinsurance protection.