Demonstrated value of ILS during COVID to drive capital to the market: Aon

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The fact insurance-linked securities (ILS) such as catastrophe bonds and other reinsurance-linked assets clearly demonstrated their value during the height of the COVID-19 pandemic financial market volatility, is likely to draw investors to the sector, Aon Securities believes.

The most negative effect of the pandemic on catastrophe bonds was a brief pause in issuance, for around a month at the height of the global lockdowns in late March into April.

Aside from that, the cat bond market came under selling pressure, as investors needed to free up capital from performant assets that hadn’t lost their value at a time when equity and debt markets were in turmoil.

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