b'ILS AND CONVERGENCE MARKETSDecember 2021 marked the 25 thanniversary of the George Town Re Ltd. transaction, widely considered to be the first 144A offering of catastrophe bonds. In the 25 years since George Town Re Ltd., cumulative issuance of catastrophe bonds has reached almost $135 billion.In 2021, catastrophe bonds and other insurance-linked securities (ILS) issuances, as well as other convergence market products, such as sidecars, dedicated funds and collateralized reinsurance vehicles, continued the growth trends of prior years, emphasizing the convergence markets role as a key component of the global reinsurance market.The volume of new risk-linked security issuances in 2021 was the largest in the history of the market, notwithstanding ongoing COVID-19 pandemic-induced financial market uncertainty and some of the largest insurance industry losses from natural catastrophe events on record. In addition, 2021 saw utilization of the market by a diverse group of sponsors, issuances from new domiciles and the introduction of new features into existing ILS programs. We review below the markets for catastrophe bonds, sidecars and ILS-dedicated funds.2021 saw a record approximately $20.3 billion of new risk-linked securities issuances, compared to the prior record of $16.4 billion in 2020. This issuance level is the highest ever recorded in the history of the ILS market by a significant margin. In the catastrophe bondmarket, US catastrophe risks (particularly US multi-peril and US earthquake) continue to lead, representing approximately 43.9% of outstanding bonds at year-end. Japan risks (earthquake and typhoon) declined at approximately 5.3% of outstanding bonds at year-end, with noticeable decline with respect to typhoon, while European-only risks increased from 0.5% of outstanding bonds at year-end 2020 to approximately 0.9% at year-end 2021. Multi-region bonds (typically covering the US and Western Europe, but also Japan and Australia) represented approximately 24% of outstanding bonds at year-end, showing continued growth and sustained investor appetite for European risks when they are bundled with other regions (thereby improving the pricing). Risks from emerging markets, including Latin America, the Caribbean and the Philippines, remained stable, representing approximately 2.1% of outstanding risks.52|Global Insurance Industry Year in Review 2021'