Allied Trust Insurance seeks debut $100m Sabine Re named storm cat bond

Another first-time catastrophe bond sponsor has come to market, as Texas headquartered Allied Trust Insurance Company looks to secure $100 million in fully-collateralized named storm reinsurance protection from the capital markets through this Sabine Re Ltd. (Series 2024-1) issuance, Artemis has learned.

Allied Trust Insurance Company is a Texas domiciled company and an admitted P&C insurer that underwrites property-related and homeowners insurance in Texas, Louisiana, North Carolina and South Carolina.

The insurer has prided itself on its diversified and secure reinsurance program in the past and now looks to grow that further with the assistance of the capital markets, through its debut cat bond sponsorship.

Allied Trust Insurance Company has established Sabine Re Ltd. as a new Bermuda domiciled company to be the issuer for its first catastrophe bond issuance, sources told us.

Sabine Re Ltd. will issue a single tranche of Series 2024-1 Class A cat bond notes that will be sold to investors and the proceeds used to collateralize a named storm reinsurance agreement with the sponsor, Allied Trust.

The Sabine Re 2024-1 catastrophe bond will provide Allied Trust with a three-year source of named storm reinsurance protection, covering losses in the states of Texas, North Carolina, South Carolina and Louisiana.

The named storm reinsurance protection will be on an indemnity trigger and per-occurrence basis, with maturity due at the start of April 2027, we understand.

The Class A notes issuance is currently targeted at $100 million in size, but has room to expand given at attachment point of $200 million and exhaustion at $360 million.

The notes have an initial attachment probability of 2.21%, an initial base expected loss of 1.48% and are being offered to cat bond investors with spread price guidance in a range from 8% to 8.75%, we are told.

It’s encouraging to see yet another first time sponsor enter the catastrophe bond market and the steady flow of debut sponsors is a strong signal for future market growth, as cat bonds become a core component of their reinsurance arrangements.

You can read all about this new Sabine Re Ltd. (Series 2024-1)  catastrophe bond and every other cat bond transaction ever issued in the extensive Artemis Deal Directory.