Twelve Capital

📢 Twelve Capital and Securis complete merger to create a leader in Insurance-Linked Securities (ILS)📢 We are happy to announce that Twelve Capital and Securis Investment Partners join forces! As we merge our expertise and resources, we are creating one of the largest independent insurance and Insurance-Linked Securities (ILS) investment managers globally. To stay updated on market insights, firm updates, and thought leadership, we invite you to follow our new official page: Twelve Securis 👉 https://lnkd.in/eYAQWEMx Thank you for being part of our journey - we look forward to continuing to grow together! #Merger #Insurance #ILS #FollowUs

𝗜𝗻𝘀𝘂𝗿𝗮𝗻𝗰𝗲-𝗟𝗶𝗻𝗸𝗲𝗱 𝗦𝗲𝗰𝘂𝗿𝗶𝘁𝗶𝗲𝘀: 𝗣𝗿𝗶𝗰𝗶𝗻𝗴 𝗘𝘅𝘁𝗿𝗲𝗺𝗲 𝗘𝘃𝗲𝗻𝘁𝘀 𝗶𝗻 𝗮 𝗖𝗵𝗮𝗻𝗴𝗶𝗻𝗴 𝗪𝗼𝗿𝗹𝗱 Our first #thoughtleadership piece as Twelve Securis is here! 👉 https://lnkd.in/erPWciaM To stay updated on market insights, firm updates, and thought leadership, we invite you to follow our new official page: Twelve Securis

📢 Read this week's snapshot discussing 𝗢𝗽𝘁𝗶𝗼𝗻𝘀 & 𝗼𝗽𝗽𝗼𝗿𝘁𝘂𝗻𝗶𝘁𝗶𝗲𝘀 𝗶𝗻 𝗜𝗟𝗦 𝗶𝗻𝘃𝗲𝘀𝘁𝗶𝗻𝗴 on our new profile 📢 👉 https://lnkd.in/eQh_UvnP To stay updated on market insights, firm updates, and thought leadership, we invite you to follow our new official page: Twelve Securis 👉 https://lnkd.in/eYAQWEMx 

𝗧𝘄𝗲𝗹𝘃𝗲 𝗖𝗮𝗽𝗶𝘁𝗮𝗹 𝗮𝗻𝗱 𝗦𝗲𝗰𝘂𝗿𝗶𝘀 𝗰𝗼𝗺𝗽𝗹𝗲𝘁𝗲 𝗺𝗲𝗿𝗴𝗲𝗿 𝘁𝗼 𝗰𝗿𝗲𝗮𝘁𝗲 𝗮 𝗹𝗲𝗮𝗱𝗲𝗿 𝗶𝗻 𝗜𝗻𝘀𝘂𝗿𝗮𝗻𝗰𝗲-𝗟𝗶𝗻𝗸𝗲𝗱 𝗦𝗲𝗰𝘂𝗿𝗶𝘁𝗶𝗲𝘀 (𝗜𝗟𝗦) Twelve Capital and Securis Investment Partners have completed the final steps of the merger, establishing Twelve Securis as a global leader in the field of Insurance-Linked Securities (ILS). This strategic move unites a wealth of expertise, complementary skill sets, and a shared dedication to innovation in insurance investment. 👉 Read more: https://lnkd.in/eXhSwAZN

𝗧𝗮𝗿𝗶𝗳𝗳 𝗥𝗶𝘀𝗸: 𝗪𝗵𝗮𝘁 𝗜𝘁 𝗠𝗲𝗮𝗻𝘀 𝗳𝗼𝗿 𝗜𝗻𝘀𝘂𝗿𝗮𝗻𝗰𝗲 𝗜𝗻𝘃𝗲𝘀𝘁𝗼𝗿𝘀 The US has implemented or proposed significant tariff increases on imported goods from major trading partners. However, the insurance sector remains relatively resilient to tariffs and trade policies because its core business is focused on underwriting risk and managing investment portfolios rather than importing or exporting goods. Unlike manufacturing, agriculture or consumer goods, which are directly affected by trade restrictions, the insurance industry operates primarily within domestic markets and is influenced more by interest rates, regulatory frameworks and consumer demand than by global trade policies. However, there may be some indirect effects. The European property and casualty market has largely absorbed the inflationary pressures caused by supply chain disruptions following COVID-19 and the war in Ukraine. Insurers have passed on most of the claims’ inflation, driven by higher costs for spare parts and building materials, to policyholders through higher premiums. Proposed tariffs on auto imports could dampen demand in the US, leading to a diversion of new vehicles and parts to other regions. This, in turn, could reduce the cost of replacement parts for European insurers, thereby easing claims inflation. Conversely, US personal lines insurers could face higher costs as Mexico and Canada supply a significant proportion of US auto parts and construction materials such as lumber. More broadly, an extended trade war could impact insurers' investment portfolios through FX and market volatility. However, insurers typically have limited unhedged FX exposures and tightly matched assets and liabilities, mitigating the impact of financial market volatility. However, economic uncertainty could dampen consumer spending, potentially slowing new sales of life insurance products. While these products have recently benefited from higher interest rates and innovation, they also face increased competition from government bonds and bank deposits. A potential economic downturn and lower interest rates could reduce their appeal. Changes in trade policy and sharp increases in tariffs could also weigh on trade finance, with negative implications for trade credit insurers. Their revenues are linked to the volume of trade insured, while their costs rise with bankruptcies and defaults - risks to which smaller companies in supply chains are particularly vulnerable. Overall, we believe the insurance industry remains relatively insulated from changes in trade policy and is positioned as a defensive play in an increasingly uncertain economic environment. #Insurance #InvestingOpportunity

𝗘𝗹𝗲𝘃𝗮𝘁𝗶𝗻𝗴 𝗼𝘂𝗿 𝘄𝗼𝗿𝗸𝘀𝗽𝗮𝗰𝗲 – 𝗻𝗲𝘄 𝗳𝗹𝗼𝗼𝗿, 𝗻𝗲𝘄 𝘃𝗶𝗯𝗲𝘀! We are thrilled to announce that the Twelve Zurich team has moved into a new office space. We are still in the same building, but now you will find us on a new floor with a fresh, modern look. 📍 𝗧𝘄𝗲𝗹𝘃𝗲 𝗖𝗮𝗽𝗶𝘁𝗮𝗹 𝗔𝗚, 𝗗𝘂𝗳𝗼𝘂𝗿𝘀𝘁𝗿𝗮𝘀𝘀𝗲 𝟭𝟬𝟭, 𝟴𝟬𝟬𝟴 𝗭𝘂𝗿𝗶𝗰𝗵 – 𝗻𝗼𝘄 𝗼𝗻 𝘁𝗵𝗲 𝟱𝘁𝗵 𝗳𝗹𝗼𝗼𝗿. Our new space is designed to support our hybrid work environment, combining thoughtful design, technology, and collaboration areas to better align with how we work today. It is a space that reflects our commitment to innovation, flexibility, and fostering a great environment for our team to thrive. A big thank you to everyone who helped bring this vision to life — from the planners and designers to our amazing team for their support during the move. Stop by and say hello if you are in the area! Here's to new beginnings in familiar surroundings. #NewOffice #HybridWork #Teamwork #ModernWorkspace ERNST BÜROARCHITEKTUR AG

𝗣𝗿𝗶𝗺𝗮𝗿𝘆 𝗮𝗻𝗱 𝗦𝗲𝗰𝗼𝗻𝗱𝗮𝗿𝘆 𝗟𝗼𝘀𝘀𝗲𝘀. 𝗪𝗵𝗮𝘁 𝗱𝗼𝗲𝘀 𝗶𝘁 𝗺𝗲𝗮𝗻 𝗮𝗻𝗱 𝘄𝗵𝘆 𝗶𝘀 𝗶𝘁 𝗿𝗲𝗹𝗲𝘃𝗮𝗻𝘁 𝘁𝗼 𝗜𝗟𝗦 𝗶𝗻𝘃𝗲𝘀𝘁𝗼𝗿𝘀? Insured catastrophe (Cat) losses are losses from disasters covered by insurance policies, meaning insurers compensate affected individuals or businesses. In contrast, non-insured losses are those for which there is no insurance coverage, leaving governments, businesses, or individuals to bear the financial burden. Cat losses are further divided into 𝗽𝗿𝗶𝗺𝗮𝗿𝘆 𝗽𝗲𝗿𝗶𝗹𝘀 - large, well-modelled events such as hurricanes and earthquakes - and 𝘀𝗲𝗰𝗼𝗻𝗱𝗮𝗿𝘆, which include smaller, more frequent events such as wildfires, hailstorms, and flash floods. Many brokers and reinsurers have released estimates of the global economic impact of natural catastrophes in 2024. While differences in methodology make direct comparisons difficult, some key conclusions can be drawn: • Economic losses in 2024 exceeded their 10-year average • Insured losses surpassed again an elevated USD 140bn, reinforcing the notion of a "new normal" • The impact of climate change is increasingly evident, influencing individual event behaviour and particularly the frequency and severity of secondary perils, which now account for the majority of insured losses. Notably, 2024 was the warmest year on record since 1850 • Cat Bonds, ranking senior in protection, remained resilient despite the high insured losses. Unlike privately syndicated ILS layers and traditional reinsurance, Cat Bonds are less exposed to secondary peril losses The US continues to account for the largest share of global insured losses due to its exposure to natural catastrophes and high insured values. Recent years have seen a sharp rise in secondary perils such as severe convective storm (SCS) losses, which now average around USD 40bn per year, compared to just USD 8bn per year between 2000 and 2010. The main drivers of SCS losses are hail and tornadoes, both of which have become more frequent than historical averages. Scientific research suggests that SCS perils have the highest degree of uncertainty about future behaviour in a changing climate. While climate patterns remain unpredictable, there is strong evidence that urbanisation, rising labour costs and inflation have contributed significantly to the escalating financial impact of these perils. Hurricanes remained the most expensive single events, with Helene and Milton causing estimated economic losses of around USD 80bn and USD 35bn respectively. However, insured losses for both storms were significantly lower at around USD 20bn each, as much of the damage was caused by flooding in areas with low flood insurance take-up. However, despite an above-average North Atlantic season, no major hurricanes made direct landfall in densely populated US cities. As a result, insured losses, while elevated, remained manageable for the industry. Figures: Gallagher Re, AON, Munich Re, Swiss Re. #ILS

𝗠𝗲𝗱𝗶𝗮 𝗥𝗲𝗹𝗲𝗮𝘀𝗲: 𝗧𝘄𝗲𝗹𝘃𝗲 𝗖𝗮𝗽𝗶𝘁𝗮𝗹 𝗮𝗻𝗱 𝗟𝘂𝗺𝘆𝗻𝗮 𝗜𝗻𝘃𝗲𝘀𝘁𝗺𝗲𝗻𝘁𝘀 𝗹𝗮𝘂𝗻𝗰𝗵 𝗶𝗻𝗻𝗼𝘃𝗮𝘁𝗶𝘃𝗲 𝗣𝗮𝗿𝗮𝗺𝗲𝘁𝗿𝗶𝗰-𝗳𝗼𝗰𝘂𝘀𝗲𝗱 𝗙𝘂𝗻𝗱 Twelve Capital and Lumyna Investments, part of Generali Investments, are pleased to announce the launch of the Lumyna – Twelve Capital Parametric ILS Fund, a pioneering fund designed to provide diversification, enhanced returns, and de-correlated performance by investing in innovative parametric insurance transactions. Seeded by a leading European institutional investor, the fund will collaborate with fintech leader Descartes Underwriting and top-tier European insurer GC&C, Generali Group’s Global Corporate & Commercial arm which offers innovative Parametric Solutions, benefitting from Generali's underwriting excellence and highly rated insurance balance sheet, alongside Descartes' origination and underwriting capabilities. The fund also plans to allocate to Cat Bonds and ILWs to further enhance liquidity and diversification. 👉 Read more: https://lnkd.in/eQKEtHNt #ParametricInsurance #MediaRelease #ILS

🔥 𝗧𝘄𝗲𝗹𝘃𝗲 𝗖𝗮𝗽𝗶𝘁𝗮𝗹 𝗘𝘃𝗲𝗻𝘁 𝗨𝗽𝗱𝗮𝘁𝗲 – 𝗪𝗶𝗹𝗱𝗳𝗶𝗿𝗲𝘀 𝗶𝗻 𝗟𝗼𝘀 𝗔𝗻𝗴𝗲𝗹𝗲𝘀 Since Tuesday, 7 January, unseasonably dry conditions and strong Santa Ana winds have fuelled wildfires across Southern California. The two main fires of concern, the Eaton and Palisades fires, have significantly impacted the greater Los Angeles area. The Eaton fire has burned approximately 14,000 acres and damaged over 9,000 structures, while the Palisades fire has burned over 23,000 acres and damaged nearly 7,000 structures. Encouragingly, recent rainfall has aided firefighting efforts, leading to strong progress in containment. Containment refers to the percentage of the fire where control lines have been established to prevent further spreading. The Eaton fire is 95% contained, while the Palisades fire is 90% contained. Other fires have recently ignited in the region. The Hughes fire, located further north of Los Angeles, has burned 10,500 acres but is now 92% contained. In the San Diego area, several fires emerged this week, including the Border 2 fire, which has burned 6,500 acres and is 40% contained. Insured losses are expected to be in the range of USD 20-45bn (Source: Artemis). This estimate reflects the high-value real estate areas affected, including Santa Monica and Malibu, where individual homes and properties are often valued in the USD millions. The majority of insured losses are expected to be absorbed by primary insurers and junior reinsurance layers. We believe that there are currently two Cat Bonds with occurrence structures that are affected at this stage. However, we completely excluded one of them and are underweight with the other relative to its market weight, limiting the impact on our portfolio. As noted in our previous updates, the wildfires have contributed to an erosion of the attachment point in aggregate structures meaning it reduces the severity threshold for future events to trigger losses. While the full extent of the aggregate erosion is still being assessed, we are actively monitoring the situation and are awaiting further loss updates from cedants. #Wildfire #CatBonds #ILS

𝗛𝗼𝘄 𝗿𝗲𝘀𝗶𝗹𝗶𝗲𝗻𝘁 𝗶𝘀 𝘁𝗵𝗲 𝗶𝗻𝘀𝘂𝗿𝗮𝗻𝗰𝗲 𝘀𝗲𝗰𝘁𝗼𝗿 𝗵𝗲𝗮𝗱𝗶𝗻𝗴 𝗶𝗻𝘁𝗼 𝟮𝟬𝟮𝟱? As we approach the FY2024 reporting season, our analysis of nearly 70 (re-)insurance groups, representing combined premiums of EUR 1.4tn, reveals a sector that continues to demonstrate strength and remains resilient for the year ahead. Our coverage spans multiple jurisdictions, yet focuses on comparable solvency metrics as they adhere to the same regulatory framework (Solvency II) or its equivalents (Bermuda or Swiss regimes). Capitalisation – or solvency – is a cornerstone in assessing an insurer's ability to meet its obligations to policyholders and creditors, support shareholder returns and provide a buffer against regulatory intervention thresholds. For ILS investors, while absolute capitalisation levels may be less critical, the structure and quality of capital remain key indicators of resilience to extreme events. Based on our estimates, the simple average capital position of our sample at FY2024 is 217%, while the weighted average, based on the size of own funds, stands at 223%. This suggests that larger companies are slightly better capitalised. The threshold for mandatory coupon deferral for subordinated debt and regulatory intervention is a breach of the 100% mark, and our estimated level translates into a substantial capital buffer over this mark, amounting to around EUR 475bn. The sector remains well capitalised, with levels broadly stable year-on-year (-2pp), even taking into account growth and capital repatriation. Since the introduction of Solvency II, we have observed a progressive build-up of capital buffers, which have increased by around 25 percentage points since 2016. This build-up reflects retained earnings, hedging strategies, and improved asset-liability management. In addition, recent stress tests by EIOPA, the EU’s insurance regulator, confirmed the sector’s ability to withstand severe but plausible scenarios and showed that participating insurers held both adequate capital and liquid assets. In summary, these findings highlight the robust capitalisation of the insurance sector and its ability to provide stability and opportunities across investment classes. We will continue to monitor these dynamics and remain confident in the sector's ability to provide a supportive investment environment. #Insurance #InvestmentOpportunity