Full Capacity: Cat bond momentum continues

July 25 2026 by

Welcome to Full Capacity, a weekly briefing on all the most important developments of the past week with a personal take on the news from our editor-in-chief, Mithun Varkey, delivered to your inbox every Saturday.    

M&A spotlight. Allianz sealed a deal to acquire HSBC Life (Singapore) and enter into a 15-year exclusive distribution partnership with HSBC Singapore for a combined consideration of US$2.24 billion, including a US$154 million initial lump sum cash payment for the distribution agreement. 

Meanwhile, Sompo International has inked an agreement to acquire Brazil’s Fator Seguradora, which specialises in corporate insurance, with particular strength in property, surety, and financial lines. This is the second acquisition by Sompo this month.  

New venture. In India, private equity giant Blackstone has joined forces with former HDFC Ergo CEO Anuj Tyagi to launch a general insurer. While Blackstone declined to comment on the news when contacted by InsuranceAsia News, publicly available documents showed that Blackstone and Tyagi set up the company in May.  

Lloyd’s investigation: An investigation by the Council of Lloyd’s has found that former Lloyd’s chief executive John Neal’s close relationship with corporate affairs director Rebekah Clement, which they did not disclose, could be viewed as “creating a perceived conflict of interest”.  

It found that Neal’s conduct fell significantly below the standards expected of Lloyd’s senior leaders and was detrimental to the interests of the corporation and the market.  

Hyper-scaling. Marsh has brought its US$2.7 billion data centre construction insurance facility, Nimbus, to projects in Asia. The Nimbus facility provides limits of up to US$2.7 billion and was introduced to Australia and New Zealand projects in January. 

Meanwhile, Aon has boosted the size of its data centre lifecycle insurance program for the third time this year, with the increase to US$5 billion coming amid booming demand for digital infrastructure risk solutions. 

Spring in the step 

If there were any lingering doubts about the momentum in the insurance-linked securities (ILS) space, Swiss Re’s latest ILS Market Insights report puts them to bed.  

With a record-breaking US$17 billion placed across 64 deals in H1 2026, the cat bond market is still kicking. 

As the report points out, back-to-back active months of May in 2025 and 2026 confirm that sponsors now view the cat bond market integral to the June 1 renewals.  

Years of primary issuance outpacing maturities have pushed outstanding cat bond volume to US$64.8 billion, representing a 15% increase in CAGR since 2021. 

That kind of expansion signals a fundamental re-rating of ILS capacity within the broader risk transfer ecosystem. 

What is driving this is not just sponsor demand, but investor conviction. Even as spreads compress from the post-2022 hard market highs, capital continues to flow in because cat bonds are still delivering real diversification with competitive returns.  

In a year defined by geopolitical instability and equity-market jitters, the Swiss Re index’s 4.12% H1 return reinforces the point that ILS offers a market that is not spooked by macro headlines. 

Traditional reinsurance conditions have improved, yet sponsors are still leaning into cat bonds as the rise in first-time sponsors shows. 

In Asia too there were notable new issuers, such as the Asian Development Bank-sponsored earthquake and precipitation bonds for Tajikistan and Kyrgyzstan of US$80 million each. 

The World Bank’s US$200 million cat bond offering coverage against hurricanes for Jamaica listed in Singapore was another major recent deal in the region. 

Meanwhile, sponsors are also taking note of investor conviction and pushing the boundaries of what they bring to market. 

Typically dominated by US peak perils, the market is now also seeing an expansion into secondary perils like severe thunderstorm and/or US wildfire, on a remote, per occurrence basis, signalling growing confidence in structuring complexity. 

Although investors continue to exercise caution, it demonstrates the acceptance of such risk perils from select sponsors. 

While the market is well-capitalised, weighted average spreads have also continued to tighten over the first half of 2026, reflecting strong investor demand.  

The report noted that elevated money market rates continue to provide meaningful support to all-in yields, which remain attractive relative to the lower rates observed in previous years. 

Though it is typical for quiet nat cat spells to drive capital rebuilding in the ILS market, increased diversification of the markets as well as increasing casualty and cyber issuances suggest that this sprint may have significantly more legs. 

People moves

Aon appointed Joe Liang as executive chairman of reinsurance for greater China.  

Price Forbes Singapore continued its MGA push with Craig McCoig-Lees hire. 

Allianz Commercial bolstered its regional ART offering with the relocation of Davinder Panesar, while Allianz Trade added Daf Owen as regional surety business development director. 

Gallagher Re has appointed Sisouda Dayre as operations director for APAC 

Do check out our weekly people move round-up to stay up to speed on the most important appointments in the region. 

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