Northshore Re II Ltd. (Series 2025-1)

This will be the seventh catastrophe bond for AXIS Capital and its subsidiaries from its Northshore Re branded catastrophe bond program, as the company looks again to cat bond-backed catastrophe protection from the capital markets as part of its reinsurance and retrocession program.

The company is seeking $150 million or more in retrocessional reinsurance from this Northshore Re II 2025-1 catastrophe bond, with the coverage set to protect the firm’s underwriting subsidiaries, including its AXIS Insurance arm, reinsurer AXIS Re, as well as its E&S company and Lloyd’s syndicates, we are told.

AXIS Capital is again utilising its Northshore Re II Ltd. Bermuda based special purpose insurer (SPI) for this 2025 cat bond.

Northshore Re II Ltd. is targeting issuance of a single tranche of Series 2025-1 Class A notes that will be sold to investors and the proceeds used to collateralize a retrocessional agreement between the SPI and AXIS itself.

This reinsurance coverage will provide AXIS and subsidiaries with multi-year and fully-collateralized protection against losses from US named storms (inc. Puerto Rico & Virgin Islands), as well as U.S. & Canada earthquake risks, we understand.

This protection will run across a three year term to April 7th 2028, sources said, with three annual risk periods running from April 1st to March 31st each year.

The cat bond is structured to provide per-occurrence protection on a territory-weighted industry loss trigger basis, we are told, unlike AXIS’ last cat bond in 2022 that provided it with aggregate protection.

The $150 million or more in Series 2025-1 Class A notes that are being offered with have an initial attachment probability of 2.67% and an initial expected loss of 2.1%, while they are being offered to cat bond funds and investors with price guidance in a range from 5% to 5.75%, we have learned.

Update 1:

We’re told that AXIS Capital has upsized its target for this Northshore Re II 2025-1 catastrophe bond issuance to $200 million.

At the same time, the spread price guidance has now fallen to the low-end of the initial range, at 5%.

Update 2:

AXIS Capital secured the upsized $200 million of reinsurance from this Northshore Re II 2025-1 catastrophe bond, with the Class A notes priced at the low-end of guidance, to pay investors a spread of 5%.