Apr 18, 2012
Chicago, 04/17/2012 – Aon Benfield Securities, the investment banking division of global reinsurance intermediary and capital advisor Aon Benfield, today launches its latest report on the insurance-linked securities (ILS) market, which reviews the key trends witnessed during the first quarter of 2012.
The Insurance-Linked Securities First Quarter Update 2012 reveals that catastrophe bond issuance for the period reached a record USD1.49 billion as investors deployed additional capital into the sector.
Retaining strong momentum from Q4 2011, a total of nine transactions closed during Q1 2012, featuring both new and repeat sponsors. An additional three catastrophe bonds totaling USD495 million priced in the quarter but did not close until Q2 2012.
Aon Benfield’s ILS Indices posted negative returns for the quarter principally reflecting spread widening, with the All Bond and BB Rated Bond Indices decreasing by 0.06 percent and 0.14 percent respectively – an improvement over Q1 2011 returns, which were negatively affected by mark-to-market losses from the Tohoku earthquake in Japan. Meanwhile, the U.S. Hurricane Bond and U.S. Earthquake Bond Indices decreased by 0.32 percent and 0.17 percent respectively during the period. For the trailing twelve months, all indices posted gains.
Paul Schultz, Chief Executive Officer of Aon Benfield Securities, said: “We are very pleased with the record volumes of ILS activity we saw in the market during the first quarter of 2012, which highlights the importance of ILS as both a risk transfer vehicle and an investment product. We believe that the market fundamentals are conducive to further growth in this sector and very pleased that issuance in the first quarter of 2012 came from both new and repeat sponsors.”
Aon Benfield Securities forecasts that full year 2012 ILS issuance will be in the range of USD5 to 6 billion.
To view the full Insurance-Linked Securities First Quarter Update 2012 report, please follow the link below:
About Aon Benfield Securities
Aon Benfield Securities, Inc. and Aon Benfield Securities Limited (collectively, “Aon Benfield Securities”) provide insurance and reinsurance clients with a full suite of insurance-linked securities products, including catastrophe bonds, contingent capital, collateralized reinsurance, industry loss warranties, sidecars and derivative products. As a recognized leader in this investment banking market, Aon Benfield Securities is helping to redefine capital by offering underwriting and placement of new issues, financial advisory services, as well as securities trading in the secondary market. Aon Benfield Securities’ integration with Aon Benfield Inc’s reinsurance operation expands its capability to provide analytics, modeling, rating agency, and other consultative services. Aon Benfield Inc., Aon Benfield Securities, Inc. and Aon Benfield Securities Limited are all wholly-owned subsidiaries of Aon plc. Securities advice, products and services are offered solely though Aon Benfield Securities, Inc. and/or Aon Benfield Securities Limited.
About Aon Benfield
Aon Benfield, a division of Aon plc, is the world’s leading reinsurance intermediary and full-service capital advisor. We empower our clients to better understand, manage and transfer risk through innovative solutions and personalized access to all forms of global reinsurance capital across treaty, facultative and capital markets. As a trusted advocate, we deliver local reach to the world’s markets, an unparalleled investment in innovative analytics, including catastrophe management, actuarial and rating agency advisory. Through our professionals’ expertise and experience, we advise clients in making optimal capital choices that will empower results and improve operational effectiveness for their business. With more than 80 offices in 50 countries, our worldwide client base has access to the broadest portfolio of integrated capital solutions and services. To learn how Aon Benfield helps empower results, please visit aonbenfield.com.
If you elect to comment or engage with our content via third-party social media websites, you authorize Aon to have access to certain social media profile information. Please click here to learn more about information that may be collected when using these tools on Aon.com