Buttonwood Re Ltd. (Series 2026-1)

Mangrove Property Insurance, a company that launched to offer homeowners’ insurance in Florida in early 2025 and as well as writing new business has also assumed policies from Florida Citizens through its depopulation program, has entered the catastrophe bond market for the first time.

Mangrove Property Insurance has established Buttonwood Re Ltd. in Bermuda, as a structure through which to issue series of catastrophe bonds.

For its first cat bond sponsorship under Buttonwood Re, Mangrove is looking to secure both occurrence and aggregate reinsurance to protect its business against losses from named storms and hurricanes in the state of Florida.

We understand the initial target is to secure $100 million of reinsurance across issuance of four tranches of Series 2026-1 cat bond notes by Buttonwood Re, that will be sold to investors and the proceeds used to collateralize reinsurance agreements with the cedent, Mangrove.

The first three tranches of notes will provide indemnity and per-occurrence reinsurance and the fourth a source of indemnity triggered annual aggregate protection, all covering named storms and set to run across a roughly three-year term, we are told.

It’s worth noting that there is different amounts of inuring reinsurance benefiting these cat bond tranches and that the occurrence layers actually sit on top of each other, even though the attachments look similar.

Buttonwood Re is offering a $25 million tranche of Series 2026-1 Class A occurrence notes that would attach their coverage at $145 million of losses and exhaust it at $305 million, giving them an initial attachment probability of 1.38%, an initial base expected loss of 1.10% and they are being offered to investors with spread price guidance in a range from 5.5% to 6.25%, we understand.

An also $25 million tranche of Series 2026-1 Class B occurrence notes sit beneath the A’s and would attach their coverage at $145 million of losses and exhaust it at $275 million, giving them an initial attachment probability of 2.18%, an initial base expected loss of 1.71% and they are being offered to investors with spread price guidance in a range from 6.5% to 7.25%.

A further $25 million tranche of Series 2026-1 Class C occurrence notes sit beneath the B’s and would attach their coverage at $145 million of losses and exhaust it at $345 million, giving them an initial attachment probability of 6.78%, an initial base expected loss of 2.59% and they are being offered to investors with spread price guidance in a range from 8% to 8.75%, sources said.

The final $25 million tranche of Series 2026-1 Class D notes will provide annual aggregate reinsurance coverage and we understand come with a deductible of $6 million and per-event cap on contribution of $24 million. The Class D notes would attach their coverage at $48 million of losses and exhaust it at $96 million, giving them an initial attachment probability of 0.42%, an initial base expected loss of 0.13% and they are being offered to investors with spread price guidance in a range from 6.5% to 7.25%.