Merna Re Enterprise Ltd. (Series 2026-1)

State Farm has returned to the catastrophe bond market in 2026 and we’re told has now secured a significant $1.5 billion of catastrophe reinsurance protection from its latest sponsorship.

Two $750 million tranches of Series 2026-1 notes have been issued by State Farm’s Bermuda based special purpose insurer (SPI) Merna Re Enterprise Ltd., a structure the insurer used for the first time in its record 2025 visit to the cat bond market.

The two tranches of notes have been sold to catastrophe bond funds and investors, with the proceeds used to collateralize the multi-year reinsurance agreements for State Farm.

The Merna Re Enterprise 2026-1 cat bond notes will provide State Farm a $1.5 billion roughly three year source of collateralized aggregate reinsurance protection, running to maturity in early July 2029, we’ve learned from sources.

We do not know the covered perils for these new Merna Re Enterprise 2026-1 cat bonds yet, but there is a good chance they are multi-peril focused given their size, and clearly cover US catastrophe perils given State Farm’s operations.

We also do not know yet whether these cat bond notes are providing per-occurrence or annual aggregate coverage, but they are expected to be providing their reinsurance on an indemnity trigger basis to State Farm, as all of its cat bonds have in the past.

Merna Re Enterprise Ltd. has issued a $750 million tranche of Series 2026-1 Class A notes and for now all we know is that the initial risk interest spread they will pay investors is said to be 6.25%.

Merna Re Enterprise Ltd. has also issued an equal sized $750 million tranche of Series 2026-1 Class B notes, of which again all we know is that the initial risk interest spread they will pay investors is said to be 9.25%.

We will update this page as any further details on perils and coverage structure emerge.