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Casualty ILS could grow as platforms embed capital finality

Global alternative reinsurance capital in ILS is forecast to reach a record $144.5 billion by mid-2026, including over $65.6 billion in catastrophe bonds and $23 billion in reinsurance sidecars.

Reported · Written up by our desk · Industry & Deals

Strategic Risk Solutions, an independent provider of insurance, reinsurance, and captive management and consulting services, says casualty insurance-linked securities could see a breakthrough if ILS platforms provide dependable exit mechanisms.

According to Strategic Risk Solutions, the key is embedding capital finality from inception, aimed at giving investors entering longer-tail casualty risk greater certainty.

The firm also pointed to ongoing market expansion, noting that global alternative reinsurance capital in ILS is projected to hit a record $144.5 billion by mid-2026.

Strategic Risk Solutions said the outlook includes an outstanding catastrophe bond market of more than $65.6 billion and a record $23 billion in collateralized reinsurance sidecar structures, suggesting third-party capital is becoming a larger and more diverse component of global reinsurance capacity.

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