Yet another private catastrophe bond, or cat bond lite, has been issued through the Kaith Re Ltd. Bermuda domiciled segregated accounts vehicle of German reinsurance firm Hannover Re, a $25 million Seaside Re (Series 2019-42) transaction.
The transaction which was listed on the Bermuda Stock Exchange (BSX) yesterday follows $87 million of Seaside Re private cat bonds across six transactions and one $10 million LI Re private cat bond, all of which were issued by Hannover Re’s vehicle Kaith Re in December.
All of these private cat bond are being issued around the renewal for a good reason, providing ILS investors with a way to access securitised reinsurance and retrocessional risks either ceded by Hannover Re itself or a cedant it is acting as transformer and facilitator for.
In this latest transaction, Kaith Re Ltd. acted on behalf of its segregated account named Seaside Re to issue the $25 million series of notes, which collateralise an underlying reinsurance or retrocession agreement for the investors on the other side of the deal.
The Series 2019-42 notes issued by Seaside Re have a due date of January 15th 2020, so likely represent a one year collateralized reinsurance or industry loss warranty (ILW) transaction, as are most common with private cat bonds.
The due date of Jan 15th is the same as with the previous Seaside Re transactions, suggesting these are all layers of the same program, likely Hannover Re helping investors to access insurance-linked returns through its own retrocessional reinsurance program with this series of securitised private cat bond notes.
This Seaside Re private cat bond program provides ILS investors with access to U.S. property catastrophe risks in cat bond lite form, however full details of these transactions and the reinsurance or retrocessional coverage they provide are not available.
We’ve added this latest $25 million Seaside Re private cat bond to the Artemis Deal Directory and what information we have on the deals will be included in all of our catastrophe bond and ILS market statistics.
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