Pelican IV Re Ltd. (Series 2017-1)
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Pelican IV Re Ltd. (Series 2017-1) - At a glance:
- Issuer / SPV: Pelican IV Re Ltd. (Series 2017-1)
- Cedent / Sponsor: Louisiana Citizens Property Insurance Corporation
- Placement / structuring agent/s: GC Securities is sole structuring agent and bookrunner.
- Risk modelling / calculation agents etc: AIR Worldwide
- Risks / Perils covered: Louisiana named storm
- Size: $100m
- Trigger type: Indemnity
- Ratings: NR
- Date of issue: Apr 2017
Pelican IV Re Ltd. (Series 2017-1) - Full details
Louisiana Citizens fourth catastrophe bond transaction sees it looking for reinsurance coverage on a more remote, higher layer of its tower than the previous deals, as it looks to tap the capital markets for cover that will attach at $350 million of Louisiana named storms indemnity losses.
Pelican IV Re is a newly established Bermuda special purpose insurance vehicle. For this deal, Pelican IV Re will seek to issue a single tranche of Series 2017-1 Class A notes, which will be sole to investors to collateralize a reinsurance agreement between it and the sponsor Louisiana Citizens.
The $100 million of notes will cover the sponsor against losses from Louisiana named storms (so tropical storms and hurricanes), on a per-occurrence basis and using an indemnity trigger structure.
The notes will attach at $350 million of losses to Louisiana Citizens and cover it up to $450 million, giving them an attachment probability of 1% and an expected loss of 0.86%.
The Pelican Re IV 2017-1 notes are being offered to ILS investors with coupon guidance of 2.75% to 3.25%, which as multiples go is relatively high, so again this cat bond could well price down during its marketing phase.
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