#56 - Alternative Risk Transfer: Why, When & How
The guys go deep into alternative risk transfer this week, discussing insurance-linked securities (ILS), cat bonds, and why re/insurers may choose different ways to mitigate risk other than traditional reinsurance deals. This episode is also packed with analogies, including one from ChatGPT! CONNECT & SUPPORT: Website: https://www.supercede.com LinkedIn: https://www.linkedin.com/company/supercedehq Twitter: https://twitter.com/SupercedeHQ YouTube: https://www.youtube.com/channel/UCuzfykcesD0phGaCK7qB09Q RSS Feed: https://anchor.fm/s/7e741c8c/podcast/rss Say Hello: producer@thereinsurancepodcast.com OUTLINE & TIMESTAMPS: (00:00) Intro (02:57) Jerad’s Analogy for Alternative Risk Transfer (06:18) ChatGPT’s Analogy for Alternative Risk Transfer (08:31) Ben’s Analogy for Alternative Risk Transfer (10:02) Insurance Linked Securities (ILS) Explained (15:22) Concerns With ILS Compared to Traditional Reinsurance (17:58) Drivers of ILS Purchasing, Cat Bonds, & Capacity Constraints (19:48) Basis Risk: Indemnity Triggers & Parametric Coverage (22:22) Traditional Reinsurance Vs. Alternative Risk Transfer (26:15) Brokers Using Creativity to Solve Client Problems (28:25) Insurance Add-Ons, Protections, & Exclusions