Authors: William Dubinsky Jason Bolding Alexandre Delacroix
Insurance-linked securities (ILS) have evolved significantly since the early days of the market. They have become increasingly mainstream both as a source of risk transfer capacity for sponsors and as a source of diversification for capital market investors.
As of April 1, 2025, the market includes $49.1 billion in non-life catastrophe bond (cat bond) capacity, supported by a growing and increasingly sophisticated investor base. With reduced risk premiums, improved modeling confidence, and lower transaction costs, ILS continue to gain ground as a viable alternative to traditional reinsurance.
Non-life ILS capacity has grown by nearly 480% since 2010. As the market matures, Gallagher Securities expects continued growth, driven by the benefits of full collateralization, fixed multi-year pricing and access to a broad pool of capital markets investors.
In this report, we review
- How ILS and cat bonds are structured and triggered
- The current size and dynamics of the market
- Key sponsor and investor trends, including record 2024 issuance
- Innovations in perils, geography, and trigger types
View the Gallagher Securities page to learn more about how our specialists can help you access investment opportunities in catastrophe bonds, sidecars and related solutions.
