Property damage at a mobile-home park after passing of Hurricane Irma in Naples, Fla. Florida hurricane risk is so large that half of the $26 billion in outstanding catastrophe bonds include that as a risk exposure. With damage estimates for Hurricane Irma tumbling, investors in “cat bonds” will likely avoid the significant losses they may have absorbed had earlier, more aggressive estimates borne out. Florida hurricane risk is so large that around half of the $26 billion in outstanding cat bonds include that as a risk exposure. But cat bonds returned less over the 12 months through June 30: 6.4% compared with 7.9% for the high-yield index. A record $11.3 billion of new cat bonds were issued in the 12 months through June, according to Aon Securities.

Source: Wall Street Journal September 11, 2017 21:30 UTC