California FAIR Plan aiming to upsize Golden Bear Re cat bond to $350m – $500m

The California FAIR Plan Association is aiming to upsize its debut catastrophe bond, with the target size now raised to secure between $350 million and $500 million in wildfire reinsurance protection through the Golden Bear Re Ltd. (Series 2026-1) cat bond issuance, Artemis has learned.

The California FAIR Plan, which is the insurer of last resort for California property owners needing basic fire insurance, entered the catastrophe bond market for its first-time sponsorship back in November, with an initial target to secure $250 million or more in reinsurance from this Golden Bear Re deal.

The California FAIR Plan buys a significant reinsurance program, with its 2025 reinsurance structure providing total coverage of around $5.78 billion, above an attachment at $900 million of losses.

Given its significant reinsurance needs, it is no surprise to learn that the California FAIR Plan is now looking to increase the size of its debut catastrophe bond.

Sources have told us that the target size for this issuance is now lifted to secure between $350 million and $500 million of fully-collateralized wildfire reinsurance backed by cat bond investors.

Even at its initial target size, this Golden Bear Re 2025-1 catastrophe bond was set to become the largest pure wildfire catastrophe bond ever issued. Now, it will eclipse the previous highest ($200m back in 2018) by an even more significant margin, it seems.

With this upsized target, that could see this cat bond doubling from its initial target size, Bermuda based company Golden Bear Re Ltd. is now looking set to issue a $350 million to $500 million single tranche of Series 2026-1 Class A notes.

Those notes will provide the California FAIR Plan with capital markets backed protection against California wildfire losses on an indemnity trigger and per-occurrence basis over a three year term running to the end of 2028.

The Class A notes will come with an initial expected loss of 2.24%. They were first offered to investors with spread price guidance in a range from 10.5% to 11.5%, but we’re now told that the price guidance has been updated to a revised lower range for a spread of between 10.5% and 11%, so narrowed to the lower-half of the initially marketed range.

It’s encouraging to see the California FAIR Plan responding to investor feedback for its debut catastrophe bond deal and demonstrating its desire to source more of its reinsurance from the capital markets.

This new deal will take the number of pure wildfire catastrophe bonds issued this year to four so far, which is the most we’ve ever recorded in our Deal Directory.

As we reported yesterday, broker Acrisure Re said that it believes wildfire cat bonds are poised for further growth as risk models and structures advance.

You can read all about this new Golden Bear Re Ltd. (Series 2026-1) catastrophe bond and view details on almost every other cat bond ever issued in our extensive Artemis Deal Directory.