78: Unlocking Asian non-catastrophe risks for ILS capital

At our recent virtual ILS Asia 2021 conference we held a panel discussion focused on accessing new and diversifying sources of risk from the Asia region. Much of the ILS market is still focused on catastrophe risks, being the pre-dominant component of the insurance-linked securities (ILS) market. But increasingly there is appetite among investors for more, while insurers and reinsurers are keen to access efficient risk capital for a much broader set of risks. And that holds true in Asia Pacific as much as anywhere else. So, this panel discussion is focused on the opportunity in non-catastrophe risks in Asia, why ILS capital may be well suited to some of these and how the market can develop over-time into something attractive and diversifying, while making useful risk capital available to cedents. Speakers explained that some of the advantages of participating in non-cat ILS, for investors, includes being able to hedge some of the risk exposure linked with market risk and cat dominant portfolios. While also highlighting some unique challenges facing the region, including changing regulations and demographics which can differ from country-to-country. Speakers also acknowledged that there is a long-way to go for the Asian market to embrace ILS capital across the risk spectrum, but that opportunities exist to begin making headway.

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