Jersey Ready To Go As An Insurance-Linked Securities Domicile

The use of insurance-linked securities ("ILS") to transform insurance risks to the capital markets has increased and evolved over the last decade, and the trend is expected to continue. Jersey has a leading reputation among capital market investors and sponsors, and is well placed to take advantage of the growing convergence of the capital and (re)insurance markets.

ILS products typically include catastrophe bonds ("Cat bonds"), industry loss warranties ("ILWs") and sidecars, with cat bonds being the most high profile. Cat bonds are risk-linked securities that transfer catastrophe risks to capital market investors. ILWs enable a purchaser to buy protection based on insurance industry losses arising from a specific event, rather than from the buyer's losses. Sidecars are special limited purpose (re)insurance companies which assume a portion of the ceding (re)insurer's underwriting risks (including losses and expenses) in exchange for a proportional share of the