Following its recent publication of a discussion paper on rating insurance-linked securities (ILS), with a focus on catastrophe bonds, Moody’s Ratings has moved forward and developed a new methodology for rating cat bonds and other ILS and is now seeking final feedback before its implementation.Moody’s Ratings published its discussion paper on insurance-linked securities (ILS) and cat bonds and sought feedback from market participants to help clarify its understanding of ILS market dynamics and associated credit risks.Now, with a proposed cat bond and ILS rating methodology in the wild, Moody’s is looking for any final input and comments from the industry to assist in shaping its process.Moody’s explained that the key elements of its proposed new catastrophe bond and ILS rating methodology are: Moody’s Ratings further stated that “Unless changes are made following the comment period, this new credit rating methodology will be adopted as proposed.” The rating agency has put out a request for comment, giving market participants until October 13th 2025 to respond.

Comments can be submitted via (you may need an account and to login to submit feedback).Full details of the proposed rating methodology for insurance-linked securities (ILS) (again, you will need to login to see it).As we’ve said before, although ratings are not widely used in the catastrophe bond or broader ILS sector today, they are still seen as beneficial by certain investors and sponsors.

So, keeping rating methodologies for cat bonds and other ILS up-to-date and available is important, as is ensuring they reflect how the market has developed over time..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.