Organizations Involved: Environmental Defense Fund
Source: Initiative on Climate Risk and Resilience Law
Catastrophe bonds are the most well-known type of ILS to transfer catastrophe risk to capital market investors and the second-largest according to volume. The first catastrophe bonds were issued in the mid-1990s and the market has been steadily growing since that time. This primer explains the general mechanics of catastrophe bonds, provides examples of their use, and outlines future opportunities for the market.