April 22, 2024

Coca-Cola pension fund ILS investments grow to $254m in 2023 on strong returns

Having seen its investments into insurance-linked securities (ILS) shrink in value since 2017 saw the market impacted by a string of more significant catastrophe loss years, the pension fund of global beverage and food giant the Coca Cola Company has experienced a more positive year in 2023, with the value of its ILS investments increasing.

coca-cola-imageThe Coca Cola fund ILS allocation is one of the pensions investing in insurance-liked securities (ILS) that has proved easier to track over the years, thanks to its disclosures.

The pensions ILS allocation has fluctuated and generally declined since 2017, as the clear effect of catastrophe losses dented valuations and drove a steady decline.

But the Coca Cola pension fund has maintained an allocation, which now after a few challenging years appears to have stabilised again.

The corporate pension fund of Coca-Cola Company has been an investor into insurance-linked securities (ILS) for roughly a decade now.

At one stage, its allocation to ILS amounted to almost 7% of the Coca Cola corporate pension plan assets, at close to $600 million, demonstrating a strong appetite for reinsurance-linked investment exposure.

That was back at the end of 2016. Since then, the Coca Cola pension allocation to insurance-linked securities (ILS) has steadily shrunk.

A year ago, over the course of 2022, the Coca Cola pension funds ILS assets fell in value by almost 26%, from $330 million at the end of 2021, to just $246 million at the end of that year.

But 2023 has seen a much more stable outcome, with the Coca Cola pension’s ILS investments ending last year valued at $254 million.

Which represents the first year of growth for some time, likely driven by the strong returns achieved in the ILS market.

Over the years, the Coca Cola pension fund has had both catastrophe bond and private ILS or collateralized reinsurance fund allocations in its time investing in ILS.

The Coca Cola Company pension is just one of the numerous pension fund and major ILS investors we track in our directories here.

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