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2021 marks a record year for catastrophe bond issuance: Report

6th January 2022 - Author: Luke Gallin

Catastrophe bond and related insurance-linked securities (ILS) issuance reached a huge $14 billion in 2021, representing year-on-year growth of 15%, reports Artemis.

q4-2021-catastrophe-bond-ils-market-reportThe latest quarterly report on the catastrophe bond and related ILS market, which examines issuance in the fourth-quarter and full-year 2021, is now available for you to download.

Artemis’ report shows that traditional 144a property catastrophe bond issuance totalled $2.8 billion in the quarter, making it the second most active fourth quarter in the market’s history.

But when combined with the previous three quarters of the year, property catastrophe issuance reached a new annual high of $12.5 billion.

Add to this the range of privately placed, or cat bond lite transactions and also cat bonds covering other lines of business, then fourth quarter issuance hit an impressive $3.2 billion and full-year issuance a new record high of $14 billion.

Artemis’ data shows that this is approximately $2 billion, or 15% above the previous record set in 2020, as sponsor and investor appetite remained strong throughout the year amid favourable market conditions.

As we wrote in October, the outstanding market size reached a new high of $35.5 billion up to the end of the third quarter. And while a number of deals matured in the final quarter of the year, issuance was robust enough to ensure the market achieved outright growth once again, ending the year at a new high of almost $36 billion.

The data shows that this represents growth of almost 8%, or over $2.5 billion from the end of 2020.

The Q4 2021 report also breaks out mortgage ILS issuance for both the quarter and year, showing that a record number of deals came to market in the 12-month period to bring a record $6.3 billion of mortgage risk capital to market.

Download Artemis’ latest quarterly report on the catastrophe bond and related insurance-linked securities (ILS) market now.

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