ILS Capital aims to bring something new to investors in reinsurance and catastrophe risk, by including specialty reinsurance investments.
Insurance-linked securities are products of the rapid development of financial innovation and the convergence of the insurance industry and the capital markets. The securitization model has been employed by insurers eager to transfer risk and use new sources of capital market funding.
An investor in ILS will receive interest payments, paid out of the insurance risk premium plus a money market return. As such the return is mainly determined by the insurance risk assumed.
As well as forming part of the spectrum of pure reinsurance risk transfer tools available to the global insurance market, insurance-linked securities (ILS) are also used by some large corporates to access insurance capacity from the capital markets, as well as by governments to secure disaster risk financing.
In this section, we have collected the most current articles and reviews on the topic of the ILS Capital.