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RenaissanceRe Capital Partners urges disciplined ILS right-sizing

RenaissanceRe says it has increased its investment across several funds while spreads and reinsurance rates have tightened over the past few years.

Reported · Written up by our desk · Reinsurance

RenaissanceRe Capital Partners’ Chris Parry said disciplined management of insurance-linked securities, including right-sizing capital, is more important than pursuing growth as the reinsurance cycle matures, according to Artemis.

Parry told Artemis that catastrophe bond and ILS returns remain attractive even after reinsurance rate softening, noting that cat bond spreads and reinsurance rates have compressed over the last few years. He said the spread pickup versus credit alternatives still looks compelling, despite continued tightening.

He added that RenaissanceRe has maintained conviction in the opportunity and recently increased its level of investment across several funds. Parry said committing the firm’s own capital alongside investors is meant to signal confidence in valuations and support investor deployment.

Parry said investor engagement remains strong, with existing investors active and new entrants taking a closer look. He also warned that, at this stage of the cycle, investors are paying close attention to manager behavior, emphasizing protecting underwriting margins and delivering long term returns over growing assets under management.

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