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Cyber catastrophe bonds see low 2026 issuance as investor models improve
S&P says only one new cyber cat bond has been issued in 2026 so far, even as risk modeling gains bolster confidence and could expand alternative capital if traditional reinsurers face constraints.
Cyber catastrophe bonds have had muted activity so far in 2026, even as improvements in cyber risk modeling and investor confidence support longer term growth in insurance-linked securities, according to S&P, cited by Artemis.
S&P reported that just one new cyber catastrophe bond has been issued in 2026 to date. Artemis also pointed to a March transaction in which German reinsurer Hannover Re sponsored the second renewal of its parametric cloud outage catastrophe bond, securing $35 million of retrocessional cyber reinsurance protection for cloud outage events, under its Cumulus Re program.
Artemis said the Hannover Re cat bond renewal marked the third consecutive renewal of the Cumulus Re structure and that each issuance has increased in size, reflecting growing confidence. S&P also noted that while established sponsors such as Beazley, Chubb, and Hannover Re renewed existing ILS in 2025 and 2026, no new cedents entered the market, and AXIS and Swiss Re did not renew publicly placed cyber ILS structures.
S&P added that cyber ILS investor interest appears to be driven by demand for extreme and remote risks structured as per-occurrence excess-of-loss coverage rather than attritional losses from smaller incidents. The agency also flagged risks for investors, including locked-up collateral due to slow claim development after cyber incidents, and it said cyber catastrophe bonds make up 1.3% of outstanding catastrophe bond and ILS market.