HCMA explains how ILS can help capture the insurance market’s rare window of opportunity for Intelligent Insurer
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“Insurance-linked securities (ILS) can play a transitional role: market pricing can illuminate hotspots of excessive exposure and channel capital into adaptation strategies.”
Philipp Kusche, Chairman of HCMA Europe and global co-head of ILS, Howden Capital Markets & Advisory, examines the evolution of the catastrophe bond market and how it has the potential to reshape Europe’s approach to climate and agricultural risk.
The EU’s landmark Insurance and Risk Management Tools for Agriculture report, published by the European Investment Bank, European Commission, and Howden, reveals that Europe’s agricultural sector faces €60bn in annual catastrophe risk, projected to rise to €90bn by 2050.
With a global cat-bond market worth more than €50bn, insurers across Germany and the wider DACH region are increasingly using cat bonds to diversify capital and manage exposure.
Kusche notes that ILS can help bridge the gap between market-based risk transfer and government intervention, acting as both a financial buffer and a catalyst for systemic adaptation.