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Cat bond market hits new issuance records in 2026 as ILS stays disciplined
J.P. Morgan said Q2 2026 was the largest quarter on record, with first-time quarterly issuance above $11 billion, and ILS and alternative capital showing few signs of past soft-cycle overreach.
J.P. Morgan analysts said the catastrophe bond market has continued to grow sharply in 2026, while insurance-linked securities and other alternative reinsurance capital appear more disciplined than they were during the last soft market period. The market set multiple records in the second quarter. Artemis data cited by the analysts shows Q2 2026 became the largest quarter ever for cat bond issuance, with quarterly issuance for the first time surpassing $11 billion. That compares with the prior record set in H1 2025, which was topped by more than $842 million. Artemis tracking also found the largest monthly issuance since the sector began being monitored. The report notes that 20 deals completed in May brought almost $7 billion of risk capital to the market. On the funding backdrop, J.P. Morgan said that in 2025 more than $25 billion was raised for deployment via catastrophe bonds, with net issuance of $12 billion after allowing for redemptions. For 2026 year-to-date, the analysts said more than $18 billion has been raised, and on a net basis $4 billion has been added, which is still above the 10-year average. The analysts added that catastrophe bonds have rarely been triggered over their 20-year history, and they pointed to alternative capital as a key driver of reinsurance pricing levels in prior soft cycles.