Disaster bond and associated insurance-linked securities (ILS) market exercise ranges accelerated within the second-quarter of 2024, with a file $8.4 billion of recent danger capital issued that propelled the market to a file measurement of $48 billion, Artemis’ just-released new quarterly market report details.
The Artemis Q2 2024 Catastrophe Bond and related insurance-linked securities (ILS) Market Report, available to download now, examines the cat bond and related ILS risk capital issued in the quarter and also reviews the first-half.
The second-quarter of 2024 noticed a file $8.2 billion of new issuance throughout full 144A property disaster bond transactions, cat bonds protecting non-catastrophe dangers, comparable to cyber dangers on this case, and privately positioned cat bond offers.
34 new cat bond transactions have been issued through the second-quarter, comprised of 52 tranches of notes, as constructive momentum was not solely sustained however accelerated within the interval, taking first-half 2024 issuance to an impressive $12.6 billion, which is one other file for the sector.
The quarter additionally set one other file quarter for the standard 144a property disaster bond house, which accounts for 98% of Q2 2024 issuance at $8.2 billion, and 96% of H1 2024 issuance at $12.1 billion, in keeping with knowledge from the Artemis Deal Listing.
Quite a few repeat and a wholesome variety of new sponsors contributed to issuance within the second quarter. The interval additionally featured the second largest cat bond ever, a $1.4 billion Texas multi-peril deal, and two different transactions sized at $1 billion or extra. Some new dangers additionally featured this quarter, together with a small but novel parametric cloud outage cyber cat bond.
As readers of Artemis will likely be conscious, spreads within the cat bond house have fluctuated for the reason that highs of 2023 however stay elevated and are clearly nonetheless very enticing to traders. However sponsors also had success this quarter, attaining robust execution on many offers whereas nearly all of issuances additionally grew in measurement whereas advertising, which our new report goes into some element on.
Given simply how robust the opening two quarters of 2024 have been, it’s no shock that the excellent cat bond market has additionally reached a new end-of-quarter high of $48 billion.
Over the remainder of the 12 months, Artemis’ knowledge reveals roughly $3.35 billion of cat bond notes scheduled to mature by year-end, that means if issuance is simply across the 10-year common we should always see the market maintain its new file measurement. More on this in our new report.
However, in fact, with issuance persevering with to interrupt data, the expectation is the remainder of this 12 months might beat long-term averages, that means additional outright progress of the disaster bond market is definitely potential.
Hurricane season provides some uncertainty over market exercise ranges for the approaching months and finish of 12 months, naturally, however the disaster bond market stays poised for its first $20 billion 12 months of issuance and a $50 billion file excellent market measurement can also be in attain, if the cat bond market can keep the tempo seen during the last couple of years.
We’ll preserve you up to date on all disaster bond and associated ILS transaction issuance as 2024 progresses, and we’ll report on the evolving tendencies within the cat bond, insurance-linked securities (ILS) and collateralised reinsurance market.
For full details of second-quarter 2024 cat bond and related ILS issuance, together with a breakdown of deal stream by elements comparable to perils, triggers, anticipated loss, and pricing, in addition to evaluation of the issuance tendencies seen by month and 12 months.
Download your free copy of Artemis’ Q2 2024 Cat Bond & ILS Market Report here.
For copies of all our disaster bond market reviews, visit our archive page and download them all.
