The global insurance-linked securities sector continued to grow in the second quarter, with bond issuance exceeding $US2.7 billion ($3.64 billion), according to two reports.

Willis Capital Markets & Advisory says nine non-life catastrophe bonds worth $US2.7 billion were issued, bringing overall issuance to $US4.1 billion ($5.5 billion) at the half-year mark.

Eight of the nine bond sponsors are repeat issuers, with newcomer UnipolSai Assicurazioni sponsoring a $US225 million ($303.6 million) bond to cover earthquakes in Italy and neighbouring countries for three-and-a-half years.

“Azzurro Re I is the first European risk of the year in the market, while UnipolSai Assicurazioni is the first European primary insurer of the year to sponsor a cat bond,” Willis Capital Markets & Advisory says.

Texas Windstorm Insurance Association returned to the market with a $US700 million ($944.4 million) deal to cover named storms in Texas. The deal is structured in two tranches of $US300 million ($404.8 million) and $US400 million ($539.7 million).

Another report from Aon Securities, the investment banking division of reinsurance intermediary Aon Benfield, says $US2.96 billion ($4 billion) of catastrophe bonds were issued through 10 deals in the second quarter.

Overall bond issuance amounted to $US4.66 billion ($6.3 billion) in the first half of the year, it says.

Six of the 10 second-quarter deals relate to hurricane coverage in vulnerable US regions including Florida, Louisiana, Texas and Massachusetts.

“While not quite matching the record-breaking second quarter of [last year], results during the second quarter were highly encouraging and maintained much of the momentum created during the first quarter of the year,” CEO Paul Schultz said.

“It is worth noting that the second quarter saw the issuance of a large extreme mortality bond that brought total life and health catastrophe bond issuance for [this year] to the highest level since 2007.”

The Aon All Bond and US Hurricane Bond indices were positive during the second quarter, with gains of 0.53% and 0.33% respectively.