One Shield Re Ltd. (Series 2026-1)

One Alliance North America Insurance Company, a US domestic market homeowners and commercial lines specialist, has entered the catastrophe bond market for the first time, seeking to add the capital markets into its reinsurance arrangements on a multi-year basis with this debut One Shield Re Ltd. issuance.

One Shield Re Ltd. has been established in Bermuda to issue series of catastrophe bond notes.

For its first issuance, One Shield Re Ltd. is offering a single Class A tranche of Series 2026-1 notes to investors, with the proceeds from their sale set to collateralize a reinsurance agreement with the sponsor, One Alliance North America.

The offering is initially sized at $100 million, while it is designed to provide the sponsor with a three-year source of named storm and wildfire reinsurance, on an indemnity trigger and per-occurrence basis, running from issuance through to April 2029, we are told.

On the coverage, the named storm reinsurance is for the states of Florida, Georgia, Hawaii, North Carolina, South Carolina and Texas, while the fire protection is solely for the state of California, we understand.

The $100 million of Class A notes that One Shield Re Ltd. is offering would attach their coverage at $95 million of losses and exhaust at $220 million, so cover a share of a larger layer. There is likely stated reinsurance to consider, which would make an effective first-event attachment point higher.

The One Shield Re Series 2026-1 Class A notes have an initial attachment probability of 4.55%, an initial base expected loss of 2.45% and they are being offered to investors with price guidance for a risk interest spread of between 7.5% and 8.25%, sources explained.