Eclipse Re Ltd. (Series 2020-01A)

This is the first private catastrophe bond or cat bond lite transaction to be issued using the Eclipse Re Ltd. special purpose vehicle in 2020.

After a busy 2019 when this transformer and private ILS platform was the issuer of at least around $300 million of private cat bonds, it’s expected that 2020 will also prove a busy year for the vehicle as securitisation of insurance and reinsurance risk remains in demand.

Eclipse Re Ltd. is a private catastrophe bond and insurance-linked securities (ILS) issuance vehicle managed by the Horseshoe Group and acts as a direct issuer of securitised risk transfer notes for a transaction between two parties, or as a transformer for funds to secure insurance or reinsurance risk in a more liquid and securitised form.

For the first deal of 2020, Eclipse Re Ltd. has issued a single $10 million tranche of private catastrophe bond notes which have been sold to investors or ILS funds. The proceeds from the sale of these notes will have been used as collateral to underpin related reinsurance or retrocession contracts.

This $10 million Eclipse Re Ltd. (Series 2020-01A) transaction saw special purpose Bermudian insurer Eclipse Re Ltd. issuing one tranche of Series 2020-01A notes from its segregated account SAC EC0026, with the notes having a due date of January 1st 2021.

As a result, it’s assumed the issued private cat bond notes represent a one-year reinsurance or retrocession arrangement, likely entered into at the recent renewal season.

The single $10 million tranche of notes issued by Eclipse Re has been admitted for listing on the Bermuda Stock Exchange (BSX) as insurance related securities.

ILS and reinsurance market facilitator and service provider Horseshoe Group is the lead facilitator for these Eclipse Re transactions, given it manages the vehicle and offers it to its clients.