Insurance Risk as an Asset Class
The Juniperus Opportunity
“Insurance linked investments have a risk premia that is uncorrelated to capital markets … And it’s this underlying risk premia that differentiates these investments from buying stocks or bonds. For example, the risk can be linked to natural weather…“ — Ryan Bisch, Senior Associate, Mercer Investment Consulting.- Low correlation – low correlation or sensitivity to the general economy and equity or fixed income markets. Returns are determined by certain catastrophe occurrences rather than economic activity.
- Rising prices – recent market events are causing upward pressure on premiums.
- Credibility – insurance linked investment products have achieved credibility among sophisticated investors as an established asset class.