Investors are increasingly looking at new and different ways of putting their capital into the reinsurance market in the wake of the current financial crisis.

And the ever-changing and fast-growing alternative risk transfer market offers them a number of options including risk securitisation, catastrophe bonds and sidecars.

That is according to Bob Cooney, managing director of capital markets at Aon Re Global, who was speaking to delegates on the second day of the 22nd International Reinsurance Congress held at the Fairmont Hamilton Princess hotel yesterday.

Among other topics debated during the morning at the event were emerging catastrophe markets and new forms of old risk by Brian Secrett, chief underwriting officer of Partner Re, and David Oliveira, co-portfolio manager at Nephila. Also discussed was the unfulfilled promise of enterprise management by Dr. William Panning, executive vice-president and managing director at Willis Re, and becoming a globally integrated enterprise (GIE) as the reinsurance industry adapts to macro-economic trends, from Kishore Ramchandani, associate partner of IBM Financial Consulting Practice.

The afternoon's session comprised a series of workshops on climate change and the risk and opportunity it presents and GIE, a discussion on Florida's insurance quandary led by Barney Bishop, president and CEO of Associated Industries of Florida, and the future of the reinsurance industry by a panel of Andre Perez, CEO of Horseshoe Group, David Kalainoff, head of the reinsurance division at Max Bermuda, and Lorraine Barnett, CEO of Legal Guardian.

Mr. Cooney said in today's current climate return on capital in the alternative risk transfer market was even more important to investors than before and it would be interesting to see what happens in the future.

He outlined the various sources of alternative capacity from collateralised debt obligations to cat bonds and even collateralised layers and said there was an appetite for it among investors and potential capacity available.

"There are new investors coming into the space, so despite the turmoils in the bond and debt markets, this space is still pretty alive in terms of getting investors in," he said.

"I think all that means with cat bonds, sidecars and focusing on insurance and catastrophe risk is there is going to be appetite from the investment market to come into that space and I guess it does not really correlate with a lot of things in the financial markets.

"As the market evolves, I think there will be more interest from the corporates in terms of securitisation of risks and large corporations will start to consider using cat bonds in some circumstances."

Mr. Cooney said at the end of the day it was about investors putting their capital to work in the reinsurance industry and using alternative risk transfers presented them with the chance to enjoy better returns than other investments.

"Investors may have been negatively affected in the margin, but in terms of their portfolios, maybe they are thinking it would have been good to have more of this stuff," he said.

"I think that there will be investors and we will see activity and perhaps growth in several areas.

"Reinsurance capacity, I believe, will start to get more expensive and there will be more demand because other sources of capital will be hard to obtain."