ILS market update: August 2020
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The first half of 2020 presented challenges to the Insurance-Linked Securities (ILS) market as it faced fallout and volatility from the onset of the coronavirus pandemic. While January and February were marked by tightening spreads as the sector was flush with capital, that dynamic quickly changed with the implications to the broader financial markets at the start of COVID-19 global lockdowns.
Remarkably similar to the financial crisis over a decade ago, the ILS market remained liquid, which allowed investors that had cash to take advantage of the widening spreads.