Abacab Re Ltd. (Series 2026-1)

This is a debut catastrophe bond for first-time sponsor Olympus Insurance Company, a specialist Florida homeowners insurance provider and another carrier linked to expansive MGU SageSure.

Abacab Re Ltd. has been established in Bermuda as a structure for the issuance of series of cat bond notes.

For this first issuance, Abacab Re Ltd. is targeting issuance of a single Class A tranche of Series 2026-1 catastrophe bond notes, that will be sold to investors and the proceeds be used to collateralize a reinsurance agreement between the issuer and Olympus Insurance Company.

The offering is initially sized at $100 million we understand, while it is designed to provide the sponsor Olympus Insurance with a three-year source of Florida named storm reinsurance, on an indemnity trigger and per-occurrence basis, running from June 2026 through to the end of May 2029, we are told.

The $100 million of Class A notes that Abacab Re Ltd. is aiming to issue would attach their coverage at $110 million of losses and exhaust at $360 million, so cover a share of a larger layer. But we’re told there is stated reinsurance and FHCF coverage beneath that layer, with an effective attachment point for a first-event expected to be closer to $600 million of losses.

The Abacab Re Series 2026-1 Class A notes will come with an initial attachment probability of 2.19%, an initial base expected loss of 1.66% and they are being offered to investors with price guidance for a risk interest spread of between 7.75% and 8.5%, sources said.

Also notable with this first Abacab Re cat bond, is the fact Lockton Re Capital Markets is acting as sole structuring agent for a 144A catastrophe bond for the first time ever, having previously only been a co-manager for one 144A issuance in the past. Lockton Re Capital Markets is also a joint bookrunner, another role it has not featured in before, alongside Gallagher Securities.

Update 1:

We understand that Olympus is now targeting up to $150 million of reinsurance from this debut Abacab Re Ltd. catastrophe bond.

The Series 2026-1 notes are now offered at between $100 million and $150 million in offering size, while their pricing has fallen to a revised range of 7% to 7.75%.

Update 2:

We’re told the target size remains from $100 million to $150 million for this Abacab Re catastrophe bond, but the price guidance has been lowered further with a new range of 6.25% to 7% now offered.

Update 3:

Olympus Insurance secured $120 million of reinsurance limit from its debut Abacab Re Ltd. catastrophe bond sponsorship.

The $120 million of Abacab Re 2026-1 Class A notes were finalised to pay investors an initial risk interest spread of 6.25%, so at the low-end of twice reduced guidance and representing a roughly 23% decline from the initial guidance mid-point.