LI Re (Series 2014-2)

This private cat bond deal saw Kaith Re, a Bermuda Class 3 insurer and segregated accounts company owned by Hannover Re, on behalf of its segregated cell and bond program LI Re, transform a property catastrophe reinsurance contract from an unknown cedent into an insurance-linked security which was sold to a single ILS investor as a series 2014-2 tranche of notes.

The underlying reinsurance contract does not cover Hannover Re’s risks, rather this deal sees Hannover Re acting as a risk transformer using its Class 3 insurer and segregated accounts vehicle Kaith Re to offer a cedent a private cat bond facility to effect the deal, between cedent and investor.

The LI Re ILS issuance program and the $5m of Series 2014-2 notes issued have been listed on the Bermuda Stock Exchange.