The insurance-linked securities (ILS) and reinsurance investments portfolio managed by specialist pension investor PGGM on behalf of Dutch pension PFZW delivered a 12.4% return in USD for full-year 2025, while the portfolio assets ended the year at a valuation of just over US $8.9 billion.
The portfolio of insurance-linked securities funds and reinsurance structures that PGGM Investments allocates to on behalf of the Dutch pension fund for the care and welfare sector, Pensioenfonds Zorg en Welzijn (PFZW), remains the largest allocation from a single entity investing in the ILS sector.
The insurance and reinsurance investments make up a key component of the alternative assets PGGM allocates to for PFZW, making up 3% of the total pension fund (which is around EUR 252 billion in size) as of December 31st 2025.
When we reported on the 2024 ILS portfolio, it had delivered a 15.1% return for full-year 2024, while in asset terms the ILS and reinsurance allocation ended December 2024 at around the US $8.68 billion level.
Through 2025, returns in US dollars were slightly lower, presumably aligned with the lower return environment across reinsurance compared to the prior year, with PFZW reporting that the insurance investment category delivered an annual return of 12.4% in USD for last year.
In Euros, the return was depressed by currency effects and the decline in value of the dollar, resulting in a -0.6% return in that currency.
PFZW commented, “However, the reinsurance market developed favorably: losses were limited and the settlement of claims regarding the California wildfires in early 2025 proceeded positively. This contributed to the strong return in local currency.”
At December 31st 2025, PFZW reports that almost EUR 1.6 billion of the insurance-related investments were classed as fixed income securities, which we believe may indicate the catastrophe bond portion of the allocation, which is managed by Fermat Capital Management.
Throughout 2025, the ILS and reinsurance investments managed by PGGM for PFZW remained relatively stable, although allocation range changes were reported by us for two reinsurance sidecar investments during the year, to the SCOR Concordia Re vehicle and the PartnerRe Huygens vehicle.
PGGM maintains its triple-focus within insurance-linked securities (ILS) investments, on strategies that represent aligned partnership vehicles with global reinsurance firms, as well as allocations to dedicated ILS manager operated strategies, plus the unique and owned access points to source reinsurance risk it has established such as the Vermeer Re rated reinsurance joint-venture and the Nightingale Re private mandate vehicle.
It’s worth also noting that PFZW benefited from another $150 million return of profits through a dividend from Vermeer Reinsurance Ltd., the joint-venture and rated underwriting vehicle that RenaissanceRe Capital Partners manages on its behalf.
At the end of 2025, the assets under management of the insurance-related investments portfolio that PGGM manages on behalf of the PFZW pension were valued at US $8.904 billion, up slightly from US $8.68 billion at the end of 2024.
PGGM remains the largest single investor listed in our directory of pension funds and sovereign wealth funds investing in ILS and reinsurance.
