Insurance linked securities

Article

Insurance linked securities

How insurance linked securities showcase the convergence of traditional reinsurance with capital markets

There has been a symbiotic relationship between capital markets and the insurance industry, with the insurance company seeking good investment managers to boost profits and the investment manager considering reinsurance companies with their excess investable capital as much sought after customers.

Executive summary

  • An examination of this relatively new market and products expanding under the insurance-linked securities
  • Insurance Linked Securities (ILS) appeal to institutional investors due to its nature as a low or zero correlation asset class when compared with traditional investment classes
  • Like any investment, there are risks
  • Reinsurance start-ups are beginning to take hold as an alternative for large capital market participants as a direct participation method into the Insurance Linked Securities (ILS) field
  • Transferring risk away from insurance companies to capital markets as a new means of transferring risk to willing market participants
  • Future growth potential for this industry is showing some very promising signs due to new launches and the size of those launches
PDF file - size: 193kb

Performance issue 11 – May 2013

Performance is a triannual digest, dedicated to investment management professionals, which brings you the latest articles, news and market developments from Deloitte’s professionals and clients. 

Performance issue 11 - PDF file - size: 4.6mb
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