Filling the Gaps: Climate, Disaster, Parametric Cat Bonds

The second session at the Artemis London 2022 conference on September 6th featured a panel discussion titled “Filling the Gaps”, where participants discussed climate and disaster risk, as well as parametric catastrophe bonds, moderated by Maria Rapin, CEO of Nephila Climate.

More than 240 attendees enjoyed a wide-range of informative and thought-provoking sessions and networking opportunities at the conference.

Themed largely around the catastrophe bond, attendees heard from expert speakers that have been in the sector for years, as well as newcomers with ideas of how to innovate the cat bond and ILS market going forwards.

Attendees came from as far afield as New Zealand, Hawaii, Asia, North and South America, Bermuda, as well as a large European contingent, plus as you’d expect numerous London marketplace leaders in ILS and reinsurance.

Panellists participating in this discussion were: Lorenzo Volpi, Managing Partner, Leadenhall Capital Partners; Michael Bennett, Head of Derivatives & Structured Finance, World Bank Treasury; Nils Ossenbrink, Managing Partner, Head of Distribution and Products, Twelve Capital.

The group discussed how instruments such as parametric cat bonds fit into ILS fund investment portfolios and how managers think about them.

On parametric cat bonds, Lorenzo Volpi of Leadenhall Capital Partners explained that while these are certainly attractive deals, there is a lot to consider. “Overall, premium is also important and ultimately you need to be paid for the risk, while the type of trigger is also an important factor when we look at these,” he explained.

Nils Ossenbrink of Twelve Capital added that, “We believe for an institutional investor, or other investor, it’s an ideal solution and really something we should try to grow.”

Michael Bennett, from the World Bank Treasury gave some insight into how the institution looks at the ILS market when bringing cat bond deals to market, “We will do everything we can to put it in a package that works for you modelling wise.

“We think we’re bringing you something very valuable, the investor community. We’re bringing you highly-diversifying risk, in an absolutely secure package, as it’s the World Bank issuing these bonds.

“We think we’re providing the market something extraordinarily valuable so we always ask you to work with us and have some flexibility.”

The video of this conference session from Artemis London 2022 is embedded below and can also be viewed in full, along with previous Artemis Live video interviews, at the source link below.

Source: Artemis, VArtemis London 2022. Session 2: Filling the Gaps - Artemis.b