Securitisation of Insurance Risk as an Alternative Risk Transfer Mechanism for Industrial Insurance Buyers

This article, written on invitation by the German trade journal 'Die VersicherungsPraxis', was published in the 12/2022-01/2023 issue of the journal. Addressing institutional insurance buyers rather than the ILS investor community, Solidum’s managing partner Dr. Karsten Bromann discusses the potential of cat bond instruments for the risk transfer from industrial insurance buyers to the capital markets. The paper covers current challenges and gives an overview of successful historic transactions.

Review of the 2022 ILS market and outlook into 2023

The year 2022 was challenging for investors in many asset classes, with inflation reaching new hights and return expectations rising globally in most markets. Cat bonds and private ILS were not immune to this market shift. However, they managed to perform remarkably well during these demanding times. The impact of Hurricane Ian in Florida in September further strengthened the momentum towards improved market conditions in the ILS asset class. At the beginning of 2023, the ILS market is thus as attractive as it has not been seen in a decade.

Hurricane Ian - Event Report

Major hurricane Ian hit Florida as an upper-level category 4 storm, causing significant humanitarian and economic loss. The destruction caused by the storm will noticeably affect the reinsurance and ILS markets. The present loss report discusses the storm and provides, from a perspective shortly after the event, a preliminary analysis of its impact on the reinsurance industry and the portfolios of the Solidum funds.

The year 2021 in review

The year 2021 challenged the ILS industry on several occasions. Not only hurricane Ida, but as well a selection of other noteworthy events hit the reinsurance market and caused insured losses well in excess of 100 Bn USD. The Solidum Funds sailed safely through these troubled waters and were able to generate strong results for the investors.

The attached article (German only) reviews the past year and presents the ILS market at the turn of 2022.

Interview and presentation of the Solidum Cat Bond Fund in the online forum ‘der fonds’

In December 2021 the online forum der fonds ( conducted an interview with Solidum’s Chief Risk Officer Dr. Karsten Bromann for an article about the benefits of cat bond investments in a general investment portfolio. The Solidum Cat Bond Fund was presented as well, being able again in 2021 to outperform the group of peers selected for the story.

Insurance Linked Securities – Marktüberblick Sommer 2021 (German version only)

Inflationsszenarien und die Sorge vor steigenden Zinsen sowie die immer drängendere Frage, wie weit die klassischen Anlagemärkte heute ausgereizt sind, führen zu zunehmender Nervosität auf den Kapitalmärkten. In diesem Umfeld bleibt das Interesse an Insurance Linked Securities als diversifizierendes Element in einem Anlageportfolio in der ersten Hälfte des Jahres 2021 ungebrochen, was sich in einem hohen Neuemissions-Volumen und einem aktiven Sekundärmarkthandel zeigt.

Winter Storm Uri

During the second half of February, winter storm Uri caused widespread chaos and damage in the USA. Especially Texas was hard hit. First estimates of risk modelling firms put the insured losses in excess of the cost from the wildfires and hurricanes of the last years since 2017.