Turris Re Ltd. (Series 2025-1)

This is a debut catastrophe bond for sponsor Migdal Insurance Company Ltd. which is one of the largest insurance, pension and financial service companies operating in Israel.

This cat bond sees a new peril entering the market, as if successfully issued this Turris Re Ltd Series 2025-1 deal will become the first catastrophe bond with purely exposure to earthquake risk in Israel.

A new Bermuda based company has been registered to act as issuer for Migdal Insurance’s debut catastrophe bond, named Turris Re Ltd.

Turris Re Ltd. will seek to issue a single Series 2025-1 tranche of Class A notes, that will be sold to investors and the proceeds used to collateralize a reinsurance agreement between it and the sponsor, Migdal Insurance.

We understand the initial offering size is for $100 million of notes, that are designed to provide three year’s of fully-collateralized indemnity reinsurance protection.

As said, the covered peril is earthquakes that affect Israel and the notes are per-occurrence in nature.

The currently $100 million tranche of Series 2025-1 Class A notes that Turris Re Ltd. is offering to investors would attach their reinsurance coverage at a loss of ILS 200 million and exhaust that protection at ILS 650 million, we understand.

The Class A notes come with an initial attachment probability of 0.51%, an initial expected loss of 0.27% and they are being offered to cat bond investors with price guidance for a spread in a range from 2.1% to 2.4%.

Update 1:

We’re told that Migdal Insurance has successfully priced its debut catastrophe bond, securing the targeted $100 million of earthquake reinsurance covering events in Israel.

We understand the $100 million of Turris Re Ltd. Series 2025-1 Class A notes have been priced to pay investors a risk interest spread of 2.4%, which is at the top-end of the price guidance range the notes had been offered with.