Cumulus Re (Series 2024-1)

This is the first ever catastrophe bond to cover cloud outage risks, an area of the cyber reinsurance market where coverage is often seen as lacking on a retrocessional basis.

Utilising a parametric trigger based on the outages of major US cloud provider regions, Hannover Re has secured $13.75 million of cyber retro for this peril with the assistance of Parametrix.

The $13.75 million of Cumulus Re 2024 cloud outage cyber cat bond notes have been issued by Hannover Re’s Bermuda-based structure and segregated accounts company Kaith Re Ltd.

Kaith Re Ltd. issued the $13.75 million of Cumulus Re notes as Reg 4(a)(2) notes, so private or cat bond lite notes.

The notes are said to have been placed with multiple investors.

The Cumulus Re notes will provide Hannover Re with a single year source of retrocession against major cloud outages, using a parametric trigger. The notes have a maturity date of April 14th 2025.

Hannover Re will benefit from incremental retrocessional cover that will trigger if the delivery of specific cloud services, in certain U.S. cloud regions, by one or more named cloud service providers are interrupted in excess of a specified waiting period, the companies explained.

As a result, this parametric cloud outage private cat bond provides a form of occurrence retro protection, covering Hannover Re against significant cloud outage events on a parametric trigger basis.

The $13.75 million in Cumulus Re 2024-1 notes issued by Kaith Re Ltd. have been admitted for listing on the Bermuda Stock Exchange (BSX) as insurance-related securities issued under private placement.