Hiscox Capital Partners, the division of Hiscox Re that encompasses insurance-linked securities (ILS) investments and quota-share partnerships, has experienced significant investor inflows and grown its overall ILS assets under management (AUM) to $2.4 billion at April 1st, with its catastrophe bond fund the main beneficiary.Recall that earlier this year, as a new business unit to consolidate all the capital partnership activity the organisation has managed for nearly two decades, including third-party capital and insurance-linked securities (ILS).Then, we reported that .Now, just one quarter later, the picture has changed meaningfully, as investor interest has been capitalised on, to secure $1 billion of inflows and lift ILS assets to a much higher level for the company.

ILS assets under management now stand some 60% higher than at the start of the year, as around $1 billion of capital was raised from new investors.This lifted total ILS AUM to $2.4 billion at April 1st for Hiscox Capital Partners, meaningfully increasing its ability to generate fees for the parent company.Hiscox expects that the newly raised and higher AUM will support a modest growth in its insurance contract premium written, within the Hiscox Re reinsurance division.

The majority of the new assets are flowing into its catastrophe bond fund, the company explained, clarifying that, “Investments into our catastrophe bond fund are expected to generate modest additional fee income in 2026 but do not support written premiums.” The company further stated that, “The pipeline for further alternative capital inflows remains robust.” We believe that this $2.4 billion marks the highest level of assets under management (AUM) at Hiscox’s ILS management business unit, having previously stood as high as $1.9 billion back at the mid-point of 2022.In the reinsurance division, Hiscox reported this morning that it has made a “decision not to increase net natural catastrophe exposure at this stage of the cycle.” Decreasing rates in property catastrophe risks are a key driver for the decision, it seems.Which means this higher ILS AUM could become an increasingly important tool for Hiscox at this stage of the cycle, allowing it to generate fee income to support its overall earnings.

Hiscox Capital Partners is just one of the specialist managers of catastrophe bond and ILS funds listed in our ..All of our Artemis Live insurance-linked securities (ILS), catastrophe bonds and reinsurance can be accessed online.Our can be subscribed to using the typical podcast services providers, including Apple, Google, Spotify and more.