Great Wall Re Limited – Full details:
This is the debut catastrophe bond from Chinese insurer PICC Property and Casualty Company Limited (PICC P&C).
It is the third catastrophe bond issuance to be domiciled in and issued out of the Hong Kong market.
PICC P&C has set up Great Wall Re Limited as a special purpose insurer (SPI) domiciled and registered in Hong Kong.
Great Wall Re Limited has issued a single tranche of notes totalling $32.5 million and these notes have been sold to insurance-linked securities (ILS) investors, with the proceeds used to collateralize a reinsurance agreement between the SPI and PICC P&C.
The Great Wall Re cat bond will provide PICC P&C with $32.5 million of fully collateralized reinsurance protection against losses from earthquakes in China.
The earthquake reinsurance protection will run across a three-year term for the insurer.
We are told that the Great Wall Re cat bond utilises an indemnity trigger and provides its protection to PICC P&C on a per-occurrence basis.
The issuance of this cat bond qualified for Hong Kong’s Pilot ILS Grant Scheme, which offers to support up to HK $12 million towards the issuance cost of a transaction.