Achmea targets €75m Windmill III Re 2026-1 cat bond for more windstorm reinsurance

Netherlands headquartered European insurance group Achmea is back in the catastrophe bond market again, looking to secure at least €75 million in collateralized European windstorm reinsurance protection from the capital markets with a Windmill III Re DAC (2026-1) issuance, Artemis can report.

Achmea was last in the cat bond market back in 2024, when it secured €100 million of reinsurance protection from a Windmill III Re 2024-1 deal.

The protection from that 2024-1 cat bond runs for another two years, until the end of June 2028, so it is encouraging to see Achmea now returning to layer on more protection and for the first time staggering maturities of its cat bond coverage.

This new Windmill III Re Series 2026-1 catastrophe bond sponsorship will be the fifth for Achmea. Previously it has only sponsored a new cat bond as a renewal of a maturing deal, but this time the insurer is looking to build on the 2024 issuance and grow the cat bond market’s share of its reinsurance program in 2026.

You can read about all of Achmea’s Windmill cat bond deals in our extensive Deal Directory.

For this 2026 cat bond, Achmea is using its Ireland domiciled designated activity company Windmill III Re DAC for the second time, having established it for the 2024 issuance.

Achmea Reinsurance Company NV, the group reinsurer, is again set to be the ceding entity to the cat bond transaction, we understand.

Achmea Reinsurance Company will enter into a retrocessional agreement with the special purpose issuer to connect with the capital market investors backing this issuance, then provide that reinsurance coverage to Achmea’s main property insurance underwriting subsidiaries.

Windmill III Re DAC is seeking to issue a single tranche of Series 2026-1 Class A notes that are currently targeted as a €75 million issuance in size terms, we are told.

Like the prior issuance in 2024, these Windmill III Re DAC Series 2026-1 Class A notes are designed to provide Achmea with a four-year source of collateralized reinsurance protection from the capital markets to cover certain European windstorm losses.

We understand that the coverage area is across all the major European windstorm exposed countries, but that the Netherlands is the country with the majority of the subject exposure to these cat bond notes. We are also told that, again like the previous Windmill cat bond, this new issuance will also cover losses from certain severe convective or thunderstorm types risks, including hail and tornadoes for the sponsor.

The Windmill III Re DAC Series 2026-1 catastrophe bond notes will again cover Achmea’s losses on an indemnity and per-occurrence basis.

The currently €75 million of Series 2026-1 Class A notes being offered by Windmill III Re DAC would attach their coverage at €500 million of losses and exhaust coverage at €650 million, which is the same layer where the 2024-1 cat bond notes originally sat, we understand. We do not know at this time if those notes have been reset to a different layer at this time, but it seems likely given they were €100 million in size.

The Windmill III Re 2026-1 Class A notes will have an initial attachment probability of 2.95%, an initial expected loss of 2.58% and are being marketed with price guidance in a range from 4.25% to 5%, sources said.

For comparison, the €100 million of Windmill III Re 2024-1 notes had an initial expected loss of 2.19% and priced to pay investor an initial risk interest spread of 5.25%, with this new offering reflecting the softer reinsurance market and cat bond pricing conditions seen today.

It’s encouraging to see Achmea in the market and looking to begin layering catastrophe bond coverage within its reinsurance tower, staggering the maturities of its capital markets backed protection from the Windmill series of deals.

You can read all about this Windmill III Re DAC (2026-1)  transaction and every catastrophe bond deal in our extensive Artemis Deal Directory.