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Catastrophe Bond Issuance Neared Pre-Crisis Highs in 2013: Report

Sales of catastrophe bonds, used by insurers as a way of selling on their exposure to natural disasters, are close to levels last seen before the financial crisis, new data shows.

By Reuters | Updated on January 29, 2014

LONDON (Reuters) – Sales of catastrophe bonds, used by insurers as a way of selling on their exposure to natural disasters, are close to levels last seen before the financial crisis, new data shows.

A flood of capital from pension and hedge funds, drawn by 5-7 percent yields for many so-called “cat bonds” when more traditional assets pay rock bottom rates, has driven down prices and hurt profitability for reinsurers.

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