Solis Re Ltd. (Series 2025-1)

This is the first catastrophe bond that will benefit entities of AmTrust Financial Services since 2017 and only the second cat bond ever sponsored by the company.

AmTrust has returned to the cat bond market with a goal to secure named storm reinsurance from the capital markets to cover its portfolio of commercial, specialty programs and E&S business in the United States northeast, we understand.

Solis Re Ltd. has been established in Bermuda for the issuance of catastrophe bond notes and the target for this initial issuance is for a single $100 million or larger Series 2025-1 Class A tranche of notes to be issued and sold to investors.

The proceeds of the sale of the notes will collateralize a reinsurance agreement between Solis Re Ltd. and the ceding insurer, which is AmTrust’s subsidiary Technology Insurance Company, Inc.

Technology Insurance Company, Inc. pools risks from across a range of underwriting subsidiaries within the AmTrust Financial Services group.

The $100 million of notes will ultimately provide AmTrust with a multi-year source of indemnity and per-occurrence based fully-collateralized named storm reinsurance protection.

We understand the covered area is most of the US northeast states, including Connecticut, Delaware, District of Columbia, Maine, Maryland, Massachusetts, New York, New Jersey, New Hampshire, Pennsylvania, Rhode Island, Vermont, Virginia and West Virginia.

The reinsurance protection from the Solis Re 2025-1 catastrophe bond will protect AmTrust, via Technology Insurance Company, for a three year term, with maturity scheduled for the end of June 2028.

The Solis Re Series 2025-1 Class A notes would attach their coverage after $250 million of losses and exhaust at $450 million, so will occupy a share of a $200 million layer of the reinsurance tower, giving them room to upsize, we are told.

The currently $100 million of Solis Re 2025-1 Class A notes come with an initial attachment probability of 0.96%, an initial expected loss of 0.68% and are being offered with initial price guidance for a spread of between 3.5% and 4%, sources said.

Update 1:

We understand that AmTrust is now targeting up to $150 million of reinsurance from its first Solis Re Ltd. catastrophe bond, while the price guidance has been lowered to a spread of 3.5%, so the bottom of the initial range.

Update 2:

AmTrust has now secured the 50% upsized target of $150 million of reinsurance from this Solis Re Ltd. catastrophe bond issuance.

We’re told the now confirmed as $150 million of Solis Re 2025-1 Class A notes have been priced to pay investors an initial risk interest spread of 3.5%, the bottom-end of initial guidance.