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US insurer Farmers Insurance Group, a subsidiary of Zurich Insurance Group, issued $160 million Topanga Re Ltd. (Series 2021-1) four-year two-tranche CAT bonds. The original target was $100 million. from $100 million. They will cover certain losses from named storms, earthquakes, severe weather and wildfires affecting the United States, on a per-occurrence and indemnity trigger basis.

Warehousing and supply-chain focused real estate investor Prologis issued $95 million Logistics Re Ltd. (Series 2021-1) three-year single-tranche CAT bonds. They will cover losses from US earthquakes across, 50 states (with California the peak exposure) on an indemnity and per-occurrence basis. The bonds were priced at the top of the 3% to 3.5% coupon guidance range.

Defined benefit schemes are increasingly looking to derisk their investment approach to protect their improved funding levels, according to new research from Aon.The consultancy’s ‘Global risk survey’, which received responses from 137 UK representatives of schemes of all sizes, showed that three-quarters of schemes now have funding levels higher than they were before the pandemic. As a result, more than half (51 per cent) said they were looking to lower their equity exposure over the next year, while 34 per cent expected to increase their use of credit, and a further 37 per cent said they would allocate more to liability-driven investment strategies.

American Family Mutual Insurance Company is now looking to issue $125 million (versus the original $100 million) of Four Lakes Re Ltd. (Series 2021-1) three-year single-tranche multi-peril CAT bonds. They will cover losses from named storms, earthquakes, severe thunderstorms, winter storms, wildfires, volcanic eruptions and meteorite impacts across the United States, on an indemnity and per-occurrence trigger basis.

Aon appears to be expecting another large longevity swap deal to complete before year end, forecasting that UK 2021 longevity swap volumes will reach £15 billion. So far in 2021, Artemis.bm has counted £12.7 billion of UK-focused pension scheme longevity swap arrangements, which is consistent with Mercer's £12 billion tally. Aon also estimates that £30 billion will be completed this year.

The Council of Ministers of Finance of Central America, Panama and the Dominican Republic (COSEFIN) hopes to tap into the capital markets for disaster insurance protection through a joint catastrophe bond issuance, with the support of the World Bank. The COSEFIN countries already benefit from parametric disaster insurance protection through the CCRIF SPC, but having noticed the success of Jamaica’s single-country catastrophe bond in the last year.

ARX Holding, the Progressive-owned parent of American Strategic Insurance Group, has reduced its issuance target for its Bonanza Re Ltd. (Series 2021-1) one-year zero-coupon discount CAT bonds, from $100 million to as little as $75 million. It is also likely dropping the riskier of the two tranches it planned to offer. The bonds will still cover losses from U.S. named storms, severe thunderstorms, winter storms, wildfires and earthquakes, on an indemnity trigger basis.

Hannover Re completed the issuance of $100 million of 3264 Re Ltd. (Series 2022-1) single-tranche three-year CAT bonds. The bonds will cover losses from U.S. named storms, thunderstorms, wildfires and winter storms, as well as U.S. & Canada earthquakes, European windstorms, Caribbean earthquakes, Japan typhoons and earthquakes, Italy earthquakes, Turkey earthquakes, Australian cyclones and earthquakes, and New Zealand earthquakes, on an industry loss trigger basis.

ARX Holding, the Progressive-owned parent of American Strategic Insurance Group, ended up issuing $80 million Bonanza Re Ltd. (Series 2021-1) one-year zero-coupon discount CAT bonds, versus the original $100 million target. It is also dropped the riskier of the two tranches it planned to offer. The bonds will still cover losses from U.S. named storms, severe thunderstorms, winter storms, wildfires and earthquakes, on an indemnity trigger basis.

The Triumph International Pension Scheme has agreed a full £49 million buy-in with Legal & General Assurance Society. The bulk annuity transaction covers around 140 deferred and 210 retired members.

Munich Re is close to completing a renewal of its Eden Re II Ltd. fully collateralized reinsurance sidecar vehicle for 2022, with a $42.1 million tranche of Series 2022-1 Class A notes maturing March 20, 2026.

"Direct proportional sidecar and quota share reinsurance or retrocession arrangements are helping that segment of the insurance-linked securities (ILS) market to expand after a few years of challenges, reinsurance broker Guy Carpenter has reported."

"A roundup up of the latest derisking transactions, including the Mitchells & Butlers scheme’s £650m full buy-in with Legal & General and the AvestaPolarit scheme’s bulk annuity transaction with Rothesay."

Nationale-Nederlanden (NN) Group finalized the issuance of EUR 75 million Orange Capital Re DAC (Series 2021-1) single-tranche three-year CAT bonds. The bonds will cover losses from windstorms and severe thunderstorms in the Netherlands and Belgium on an indemnity trigger and per-occurrence basis.

Validus, the Bermuda headquartered reinsurance underwriting arm of AIG, looks likely to upsize to at least $400 million its issue of Tailwind Re Ltd. (Series 2021-1) four-tranche three-year CAT bonds, versus the original $275 million target. It will cover U.S., Canada, Puerto Rico and U.S. Virgin Islands named storm and earthquake risks on an annual aggregate basis, using a weighted PCS industry loss index trigger.

MS Amlin issued $37.5 million Series 2022-1 two-tranche seven-year notes through its Singapore special-purpose reinsurance vehicle (SPRV) Phoenix 2 Re Pte. Ltd. CAT risk collateralized reinsurance sidecar arrangement.

Validus, the Bermuda headquartered reinsurance underwriting arm of AIG, issued $400 million Tailwind Re Ltd. (Series 2021-1) four-tranche three-year CAT bonds, upsized from the original $275 million target. It will cover U.S., Canada, Puerto Rico and U.S. Virgin Islands named storm and earthquake risks on an annual aggregate basis, using a weighted PCS industry loss index trigger.

The market for CAT bonds and related insurance-linked securities saw records broken once again in 2021, as annual issuance surpassed the previous high set a year ago and reached $14 billion across pure property and other line of business CAT bonds and private deals, according to Artemis’ data.

Alternative reinsurance capital levels in the global industry grew 3.7% during 2021, outpacing the 2.7% growth of traditional reinsurance industry capital, according to Guy Carpenter and AM Best. However, within the overall dedicated reinsurance sector capital estimate of $534 billion at end-2021, there is still a significant amount of trapped insurance-linked securities collateral included there.

The Vesuvius Pension Plan has completed a final buy-in with Pension Insurance Corporation, covering £305 million of liabilities. This bulk annuity deal is the seventh transaction of the defined benefit scheme sponsored by the metal flow engineering company. With a total of £600 million in liabilities, the scheme is now fully insured with PIC, so Vesuvius no longer bears any investment, longevity, interest rate or inflation risks in respect of the DB scheme.

"With multiple years of global catastrophes particularly in 2017 and 2018 which included the California wild fires, Hurricane Florence, Harvey, Irma, Typhoon Jebi, and Hato, Insurance Linked Securities (“ILS”)  such as fully collateralized insurance-linked contracts held by many ILS Funds are subject to significant losses from multiple covered events.  These loss events have resulted in trapped collateral which occurs when loss impacted investments are placed into side pockets for open ended funds. This effectively traps the collateral relating to the loss impacted investment from being redeployed into new ILS investments until the ultimate loss can be quantified which can take months and sometimes years depending on the complexity of the loss event.  This presents many challenges in administering ILS funds as the quantification of such losses is highly uncertain which creates valuation and liquidity issues impacting investors and ILS managers."

Munich Re completed its annual two tranche of note renewal of its Eden Re II Ltd. fully collateralized reinsurance sidecar vehicle for 2022. In December the first tranche was issued ($42.1 million of Series 2022-1 Class A notes) followed by this week's $147 million of Class B notes, both maturing March 20, 2026. At $190 million, this is the smallest Eden Re collateralized reinsurance sidecar issuance since 2015

A significant institutional investor has again privately committed to supporting nuclear liability risks in ILS form, with the renewal of two 2017-18 covering risks of corporate nuclear power operators in a CAT bond-like format for up to five more years. They pay out on an ultimate net loss trigger, if and when a losses associated with a nuclear event are above a pre-defined trigger point.

The £206.4 million Institute of Chartered Accountants Staff in England and Wales (ICAEW) Pensions Fund has completed a £50 million buy-in transaction with Canada Life. This is the third transaction for the ICAEW-sponsored scheme and its first with Canada Life. The scheme previously completed bulk annuity deals in 2014 with Just Retirement and in 2015 with Partnership.

Hannover Re used its Bermuda domiciled reinsurance transformer vehicle Kaith Re Ltd. to issue two new private one-year CAT bonds, a $15 million California quake focused LI Re (Series 2022-1) and $24 million Seaside Re (Series 2022-1) covering unknown U.S. property catastrophe risks.

Artex Risk Solutions used its Bermuda domiciled reinsurance transformer vehicle Artex SAC Limited to issue a new private $25 million three-year Artex SAC Limited – Silver Crane Note. It is probably linked to certain property CAT risks, most likely representing a securitization of either an indemnity or industry loss triggered collateralized reinsurance or retrocession transaction.

Aetna is looking to issue $200m of Vitality Re XIII Ltd (Series 2022) two-tranche four-year health insurance-linked CAT bonds; $140 million tranche of Class A notes and a $60 million tranche of Class B notes, both covering relatively remote layers of risk within Aetna’s health insurance book. Every year since late 2010 Aetna has tapped capital markets with a Vitality Re transaction.

"For the first time on-record, annual issuance of privately placed catastrophe bond transactions has surpassed $1 billion in 2021, as these more streamlined insurance-linked securities (ILS) arrangements continued to play an important role for some protection buyers, ILS funds and investors."

"We can now report that it was Toa Re Europe, the Switzerland-based European reinsurance arm of Japanese group Toa Reinsurance Company Ltd., that sponsored the recent $25 million Artex SAC Limited – Silver Crane Notes private catastrophe bond transaction, as it looks to expand its relationships with ILS investor markets."