Analysis by catastrophe bond fund manager Plenum Investments suggests that the cat bond market is implying a roughly $30 billion industry loss from the Los Angeles, California wildfires, while also reporting that the Swiss Re Cat Bond Total Return Index fell -0.27% for the last week.Updating investors and clients on the effects the California wildfires have had on the catastrophe bond market, Plenum Investments continues to believe the overall impact to the cat bond market will be limited.This echoes the previous update from the cat bond fund manager, from January 9th, .In its update today, Plenum said that, “The CAT Bond market has reacted to the ongoing events and prices of around eight CAT Bonds have been marked down in particular.” Adding, “A brief look at some of the industry-index linked CAT Bonds shows that the CAT Bond market is currently implying a USD 30bn loss to the insurance industry.” Plenum Investments then also highlighted that the cat bond market index, the Swiss Re Cat Bond Total Return Index, fell -0.27% for the last week.

The investment manager also noted the following moves for its own strategies: Plenum CAT Bond Dynamic Fund: +0.05%; Plenum CAT Bond Defensive Fund: -0.17%; and Plenum Insurance Capital Fund: -0.43%.“Plenum Insurance Capital Fund and Plenum CAT Bond Defensive fund are holders of one of the affected CAT Bonds, Topanga Re, which is a CAT Bond that insures Farmers Insurance against losses exceeding around USD 2bn on a single event basis,” the company said.The Topanga Re cat bond was .

We will report further on the latest movements of exposed catastrophe bonds in the coming days, as any new information becomes available to us.“With a market share in California of around 10% the market considers the bond to be exposed,” Plenum explained.The company noted that its Plenum Insurance Capital Fund has a 0.59% exposure to the Topanga Re cat bond, while its Plenum CAT Bond Defensive Fund has a 0.34% exposure to the bond.

Plenum Investments also pointed out that subrogation could become relevant if the cause of the wildfires were to be deemed down to electrical utility infrastructure, while the FAIR Plan assessments could elevate the industry loss and these wildfires are an ongoing event, meaning information is subject to change.It’s important to note that the moves in cat bond valuations and the market index are based on estimates for potential erosion of aggregate attachments or exposure and should be considered mark-to-market at this stage, with no actual losses suffered so far.– .

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