Non-life ILS market hits $49.1b in cat bond capacity by April: Gallagher Re

Non-life ILS capacity has increased nearly 480% since 2010. 

The non-life insurance-linked securities (ILS) market bagged $49.1b in catastrophe bond capacity, as of 1 April, reflecting continued momentum as a mainstream risk transfer tool for insurers and a diversification option for capital market investors, Gallagher Re reported.

The market has expanded significantly, with non-life ILS capacity increasing nearly 480% since 2010. 

Key factors supporting this growth include lower risk premiums, enhanced confidence in catastrophe modelling, and reduced transaction costs.

Gallagher Securities anticipates further expansion, citing advantages such as full collateralisation, fixed multi-year pricing, and access to a broad base of institutional investors.

As the ILS market matures, it continues to offer a competitive alternative to traditional reinsurance.