{"id":590,"date":"2025-06-09T15:15:42","date_gmt":"2025-06-09T15:15:42","guid":{"rendered":"http:\/\/fictionuncovered.com\/?p=590"},"modified":"2025-06-12T10:45:34","modified_gmt":"2025-06-12T10:45:34","slug":"aon-seeks-to-scale-risk-capital-for-clients-add-ils-resources-parametric-limits-at-3bn","status":"publish","type":"post","link":"http:\/\/fictionuncovered.com\/index.php\/2025\/06\/09\/aon-seeks-to-scale-risk-capital-for-clients-add-ils-resources-parametric-limits-at-3bn\/","title":{"rendered":"Aon seeks to scale risk capital for clients. Add ILS resources. Parametric limits at $3bn"},"content":{"rendered":"

This content is copyright to www.artemis.bm<\/a> and should not appear anywhere else, or an infringement has occurred.<\/p>\n

Broking giant Aon aims to, through its strategic plan, scale more risk capital for its clients, bringing more of the capital markets into its offering with an ambition to add more resources to its insurance-linked securities (ILS) business and highlighting $3 billion of parametric limits bound.
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\n\"aon-market-growth\"During the Aon investor day today, the first in nearly twenty years, senior executives from the company highlighted a desire to scale up facilities, build on its capital markets and ILS business, while highlighting the innovation and opportunity in parametric risk transfer.<\/p>\n

Aon CEO Greg Case explained that data, analytics, innovation and more capital are all key to the company achieving the strategy it has laid out at the event.<\/p>\n

Seeing the insurance market as around $5 trillion in size, Aon believes one opportunity is in optimising this, to make use of capital more efficient and solve more client problems.<\/p>\n

But just as important is unlocking more of the estimated $250 trillion global capital pool and enabling that to participate and scale up available risk capital to solve client problems.<\/p>\n

Talking about Aon\u2019s answer to the call for more risk capital, Case said that the strategy is to achieve a \u201cstraight up massive tour de force force effort around acceleration, around scale.\u201d<\/p>\n

Case explained, \u201cIt is industrial strength execution. It is industrial strength execution to drive an outcome on behalf of clients, that we know is going to make a difference.\u201d<\/p>\n

\u201cWe have to move money out of the $250 trillion into the $5 trillion. To make this work, you\u2019ve got to have capital movement.\u201d<\/p>\n

Andy Marcell, CEO of Global Solutions at Aon, a role he has recently taken on that brings together the risk and human capital sides of the business<\/a>, provided more insights into the need for capital, as well as examples of innovative ways Aon is helping clients to access new capital sources.<\/p>\n

He began with the facilities Aon has become well-know for, saying, \u201cIn capital solutions. What is that? There\u2019s a couple of things. One, we continue to facilitise our business, such as the creation of the Aon Client Treaty, which is in London, 10 years in the making.<\/p>\n

\u201cWhat we\u2019re trying to do here with other facilities, like that, is to create as much automatic capacity to serve our clients as we can, in the most efficient way, drawing in capital.\u201d<\/p>\n

Marcell moved on to discuss parametrics, an area of growth for Aon like most other brokers, \u201cEqually important is our parametric. We have connected globally, under Joe Peiser, our parametric business around the world.<\/p>\n

\u201cSo, if you think back to two or three years ago, we probably did 20 to 30 parametric transactions for corporate clients. Now we\u2019re doing in excess of 100 plus, and it\u2019s accelerating.<\/p>\n

\u201cAnd in the trailing 12 months, I think we\u2019ve bound $3 billion of limit in that category. So that\u2019s an important area for us.\u201d<\/p>\n

Which is a helpful statistic for those tracking parametric risk transfer market growth, with one of the largest brokers now binding $3 billion of limit for risks linked to parametric triggers in a year.<\/p>\n

Moving on to Aon\u2019s insurance-linked securities practice, that sits under the Aon Securities unit. Marcell highlighted this as an area for continued investment and a business unit likely to grow.<\/p>\n

\u201cIn insurance linked securities, so think cat bonds, where we\u2019ve been the market leader for some time, demand and our position in that is accelerating all the time. So we\u2019re going to put more resources into that category,\u201d Marcell explained.<\/p>\n

Later in his presentation at the Aon investor day, Marcell highlighted one example that brings together some of this, in being a parametric risk transfer instrument, funded by the capital markets, that was designed to support a human capital need.<\/p>\n

\u201cWe have a client in California that was asking us the question about their talent resiliency. Post an extreme event, in this case, earthquake, what was their vulnerability to their talent, and how would they get back to operations, business resiliency,\u201d Marcell explained.<\/p>\n

\u201cThat was actually brought to us by our talent colleagues, and it came to our commercial risk, and reinsurance colleagues for a solution. So we mapped out and geo-coded where all their talent was, or what the aggregation of that population was in particular earthquake zones, describe how much limit you needed to buy to offset that.<\/p>\n

\u201cWe brought a parametric bond and so when an event happens that triggers that bond, cash will be immediately paid out and then distributed by the client to its employees in the form of an employee benefit, getting them back on their feet, back to work. It helps business resiliency, it helps employee engagement, it was fantastic.<\/p>\n

\u201cBut when you really think about what went on there, you had Aon in operation. You had an opportunity delivered by another part of the firm, by talent to risk capital, engaging reinsurance, modelling, placing the business into the parametric market, into the bond market.<\/p>\n

\u201cAnd who\u2019s investing in the bond market, ILS funds, pension funds, hedge funds. This is very similar to what\u2019s been happening in the cat bond market, where we lead, where billions of dollars has been flowing into that market over time, and it\u2019s accelerating.\u201d<\/p>\n

Marcell also said, \u201cThink back to what Greg said about the $250 trillion of capital that\u2019s out there, that we want to bring into the business. We want to bring into the business to solve our clients needs. That\u2019s what we need to do to break the trend, and that\u2019s what we\u2019re doing, real examples, and we\u2019re doing this every day.\u201d<\/p>\n

Aon seeks to scale risk capital for clients. Add ILS resources. Parametric limits at $3bn<\/a> was published by: www.Artemis.bm<\/a>
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This content is copyright to www.artemis.bm and should not appear anywhere else, or an infringement has occurred. Broking giant Aon aims to, through its strategic plan, scale more risk capital for its clients, bringing more of the capital markets into its offering with an ambition to add more resources to its insurance-linked securities (ILS) business […]<\/p>\n","protected":false},"author":1,"featured_media":592,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[17],"tags":[],"_links":{"self":[{"href":"http:\/\/fictionuncovered.com\/index.php\/wp-json\/wp\/v2\/posts\/590"}],"collection":[{"href":"http:\/\/fictionuncovered.com\/index.php\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"http:\/\/fictionuncovered.com\/index.php\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"http:\/\/fictionuncovered.com\/index.php\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"http:\/\/fictionuncovered.com\/index.php\/wp-json\/wp\/v2\/comments?post=590"}],"version-history":[{"count":2,"href":"http:\/\/fictionuncovered.com\/index.php\/wp-json\/wp\/v2\/posts\/590\/revisions"}],"predecessor-version":[{"id":593,"href":"http:\/\/fictionuncovered.com\/index.php\/wp-json\/wp\/v2\/posts\/590\/revisions\/593"}],"wp:featuredmedia":[{"embeddable":true,"href":"http:\/\/fictionuncovered.com\/index.php\/wp-json\/wp\/v2\/media\/592"}],"wp:attachment":[{"href":"http:\/\/fictionuncovered.com\/index.php\/wp-json\/wp\/v2\/media?parent=590"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"http:\/\/fictionuncovered.com\/index.php\/wp-json\/wp\/v2\/categories?post=590"},{"taxonomy":"post_tag","embeddable":true,"href":"http:\/\/fictionuncovered.com\/index.php\/wp-json\/wp\/v2\/tags?post=590"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}