Mass Transit magazine features agency profiles, industry trends, management tips and new product information.
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SEPTEMBER/OCTOBER 2014 | MassTransitmag.com | Mass Transit | 83 Visit us at the APTA Expo in booth #3113 For more information, visit www.MassTransitmag.com/10065933 Outlook Despite compression in ILS spreads, we continue to see new capital f lowing into the market on a direct and indi- rect basis. These investors are long term in nature and may stay invested even if interest rates improve in traditional investments. Spread levels achieved in the first half of 2013 are expected to continue for the remainder of the year and into 2014. The willingness of ILS investors to broaden the risks available for securitization has already brought new interest from sponsors in ILS mar- ket initiatives. The market may continue to broaden the scope of coverage beyond vanilla natural catastrophe risks and find innovative ways to utilize the fresh new capital sources. Repeat and, increasingly, new spon- sors are accessing the ILS market to lever- age the favorable market conditions. Issu- ance momentum will be strong through the rest of 2013 and into 2014. Conditions remain positive for the catastrophe bond market, with 2013 issuance on track to reach $7 billion in total. Erin Lakshmanan is a director at Aon Benfield Securities, Aon Benfield's reinsurance investment banking team, and is responsible for providing insurance-linked securities solutions to clients. She specializes in the structuring of catastrophe bond transactions. After she joined Aon Re Australia in 2005, she spent two years working in both the catastrophe and actuarial analytics teams. Following this, she spent one year working as a reinsurance treaty broker before relocating to Chicago to join the investment banking team. Since joining Aon Benfield Securities in 2008, she has been in involved in structuring more than 40 catastrophe bonds. With a background in actuarial studies, she also holds a Bachelor of engineering (civil) degree from the University of Sydney. Paul Schultz is chief executive officer of Aon Benfield Securities, the investment banking division of Aon Benfield. Schultz joined Aon in October 2000 after spending 15 years in the commercial and investment banking industry. Prior to joining Aon, he was the head of Chase Securities' Midwest-based Insurance Investment Banking Group, advising clients on mergers and acquisitions, leveraged finance, structured products, and debt issuance. He also serves as Treasurer of Northwestern University's Public Issues Committee. FIGURE 4: Investors by Category (July 1, 2012 - June 30, 2013) Aon Benfield Securities Inc. 2% Hedge Fund 2% Reinsurer 43% Catastrophe Fund 41% Institutional 12% Mutual Fund