April 14, 2025 | Admin
Over the past few weeks, I’ve had enlightening conversations with Chief Underwriting Officers, Portfolio Managers, Actuaries, and Underwriters, all revolving around one topic: Insurance-Linked Securities (ILS). These discussions highlight several trends and opportunities within this space, particularly for those in traditional re/insurance roles.
Historically, ILS has been a desirable yet niche market, often separate from traditional re/insurance skill sets. However, with increasing investor appetite and capital inflows, the demand for talent is reshaping the market. Companies are opening their doors to actuaries and underwriters who bring distinct advantages to ILS compared to traditional investment professionals. These experts excel in evaluating insurance risks, interpreting policy structures, and applying quantitative methods to risk management—skills that are highly valuable in this evolving landscape.
Investor enthusiasm for ILS is evident from the record-breaking issuance levels in 2024—a momentum that shows no sign of slowing in 2025. The influx of capital has been complemented by the emergence of new players, including both reinsurance carriers and dedicated ILS managers, many of which are based in Bermuda. It’s clear that more entrants will follow suit.
The broader appeal of ILS is also reflected in financial innovations like the Brookmont Catastrophic Bond ETF, launched recently on the NYSE. This development underscores the ambition to make the ILS asset class more accessible to investors. Additionally, Lloyd’s of London has demonstrated its commitment to the space through its London Bridge Investment platform, which deployed $1.92 billion by the end of 2024.
As the global economy grapples with cracks and tariff wars, the appeal of non-traditional asset classes like ILS grows. With returns largely uncorrelated to traditional financial markets, ILS offers investors a powerful tool to diversify their portfolios. This uncorrelated nature, combined with the sector’s innovation, makes it an increasingly important asset class in challenging economic conditions.
The growth of ILS is no longer limited to traditional Property Cat bonds. Casualty ILS and Cyber ILS are emerging as high-potential segments, attracting large institutional investors ready to deploy capital. This diversification of risks and product types is creating opportunities for traditional re/insurance professionals and expanding the need for skilled talent in the sector.
To conclude, the ILS market is evolving at a rapid pace, driven by investor demand and innovation. This growth is creating opportunities for actuaries, underwriters, and other professionals with traditional re/insurance expertise. Large re/insurers are already taking notice and laying the groundwork to ensure they stay ahead of this trend.
Whether you’re a fund, ILS manager, or reinsurer looking to hire, or a professional seeking opportunities in this space, please get int touch. I’m always open to discussions—feel free to reach out by email or phone to explore how you can engage with the exciting growth of the ILS market.
By Ross Watts Director, Bermuda & UK General Insurance (Actuarial, ILS, Underwriting)
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