New Kane SAC private cat bonds cover U.S. perils using index triggers

The four new private deals from the Kane SAC Limited Note Program private ILS issuance platform, which Artemis covered early today here, all provide cover for unnamed U.S. property catastrophe risks and feature industry loss index triggers.

The completion of the four transactions, which have all been issued using named segregated accounts of the Kane SAC Limited vehicle, brings the total number of deals completed using Kane’s facility to 11, since its launch in 2013.

The four segregated account deals, totaling $125.84m between them, all feature U.S. property catastrophe risks we have been told. Unfortunately we do not know the exact risks involved. We have also learned that all four of the private cat bond transactions feature an industry loss trigger in the underlying contract, so will only pay out if insurance industry losses reach a certain pre-defined level.

Commenting on the addition of these four deals to the Kane SAC platform, Robert Eastham, Managing Director of Kane (Bermuda) Limited, said; “The announcement of four new issuances on the Kane SAC platform serves to demonstrate that the program is meeting a very clear market demand for the ability to transact smaller capital market deals in an efficient and cost-effective manner. We expect to see strong growth in this area moving forward given the growing influence of the investment community in the insurance arena.”

As a result of sourcing some additional information on the four private cat bonds we have now added them to the Artemis Deal Directory for completeness. The transactions are listed below:

• Kane SAC Limited – Exeter Segregated Account – $54.81m
• Kane SAC Limited – Troon Segregated Account – $27.53m
• Kane SAC Limited – Muirfield Segregated Account – $26.68m
• Kane SAC Limited – Hereford Segregated Account – $16.82m

As we said in the article announcing these four private deals this morning, it is likely that they represent private collateralized reinsurance deals, or industry loss warranties (ILW’s), which have been transformed using the Kane platform in order to meet an investor mandate for securitised, liquid assets with secondary transferability.

The Kane SAC platform issued $145.44m of private ILS or cat bond notes in 2014, as well as one deal in its first year of 2013 at $9.524m. So with the addition of these four deals, adding another $125.84m, the Kane SAC Limited platform has now supported over $280m of private catastrophe bond or cat bond lite issuance.

You can find these four transactions in the Artemis Deal Directory.