Catastrophe bond issuance reached an archive $12.5 billion in 2022, topping 2022's $11.0 billion, according to Aon Securities, a unit of Aon PLC.
Aon put in its Monday statement that more than $32 billion of bonds are now active in the market and over $117 billion of catastrophe bonds have been issued in the last 25 years.
Sponsors of the securitized risk transfer in many cases are insurers but additionally include governments, from municipalities to nations, and corporate entities.
Catastrophe bonds also provide substantial capital to reinsurance retrocession markets and have gained favor as traditional markets have hardened, as with Jan. 1, 2022, renewals.
Paul Schultz, CEO of Aon Securities, said within the statement that catastrophe bonds have grown to be “an integral part of the insurance ecosystem.”
The catastrophe bond sector was born in December 1996 with the launch from the George Town Re Ltd. bond, the statement said.
