Q. With reference to Catastrophe bonds, consider the following statements:
1. These bonds provide options for insurers, reinsurers, global corporations and even governments as a way to protect themselves against natural disasters.
2. The rate of return under these bonds is higher than that of normal government or corporate bonds.
3. One of the drawbacks is the high cost of issuing and managing these bonds as compared to the cost of reinsuring against the risks.
Which of the statements given above is/are correct?