HOOPP grows insurance-linked securities investments by 35%

The retirement fund's ILS investments neared 1% of its overall portfolio by the end of the year

HOOPP grows insurance-linked securities investments by 35%

The Healthcare of Ontario Pension Plan (HOOPP), one of Canada’s largest institutional retirement fund, reported that it grew its allocation to insurance-linked securities (ILS) investments in 2022 by 35%.

This was at a faster rate than the previous year when it added 31% to the ILS portfolio, with the asset class nearing 1% of its overall portfolio by the end of the year.

HOOPP started allocating to insurance-linked securities largely via insurance-linked funds, as well as some direct investments into other reinsurance-related securities, in late 2019. By the end of 2022, its ILS asset allocation had reached C$973 million (approx. US $718.7m), up from C$721 million (approx. US $575m) at the end of 2021.

In early 2020, HOOPP hired Bernard Van der Stichele, an experienced ILS and reinsurance sector executive, as a Portfolio Manager for its Insurance-linked Securities allocation. The fund was seen to be shifting from a focus on equities, targeting a range of alternative asset classes, including insurance-linked securities, to help soften the blow of the market volatility that resulted from the COVID-19 pandemic.

At the end of 2019, HOOPP’s ILS allocation reached around C$260 million, before 2020 saw it build on the ILS investment program, more than doubling it to reach C$549 million at the end of that year (around US$440m at the time).

In 2021, HOOPP continued to steadily grow the ILS strategy, building it to C$721 million (US 575m) by the end of that year, representing growth of just over 31% in Canadian dollars.

With the ILS allocation growing 35% to reach C$973 million in 2022, HOOPP ended the last year with ILS investments nearing a 1% share of its total portfolio size.