The ILS model has been the major Disruptor in the reinsurance market over the last few years, and, as is often the case with disruption, could ultimately yield new opportunities for the industry as a whole.
The additional thought that the diversification of ILS capital could ease the pressure on rates in a soft market is, I think, both welcome and accurate.
The wealth of alternative capital in the global reinsurance market could be utilised to increase demand and grow the overall reinsurance pie, creating opportunities for insurance-linked securities (ILS) to meaningfully enter new regions and perils, according to industry experts. (...) as noted by Chief Executive Officer of Aon Securities, Paul Schultz, “If you’re not growing, if the pie’s not growing, the alternative market can only get so big. It’s the willingness to write new risks, and creating more innovative financial solutions for clients that’s offering new growth opportunities.