Catastrophe bonds and insurance-linked securities news

Florida headquartered and expansive property casualty insurer Heritage Insurance Holdings, Inc. has successfully secured its 2018/19 reinsurance program at almost flat rates, citing a risk adjusted cost increase of just 1% at its latest renewal.

The board of governors of Florida’s Citizens Property Insurance Corporation has approved the purchase of a $1.42 billion reinsurance program for 2018, which is a 7% increase on the total limit of risk transfer secured last year and with more of the coverage from the capital markets via Everglades Re cat bonds.

The debut catastrophe bond from Transatlantic Holdings, the parent to Transatlantic Reinsurance (or TransRe), is set for an increase in size, as sources said the Bowline Re Ltd. (Series 2018-1) transaction is likely to grow to $250 million, while its pricing looks set to move to the mid-point of guidance.

Florida’s Citizens Property Insurance Corporation’s latest catastrophe bond, the Everglades Re II Ltd. (Series 2018-1) transaction, has upsized before pricing to $250 million, while the coupon has now been fixed at the low-end of initial guidance.

Independent Zurich based insurance-linked securities (ILS) and catastrophe bond fund manager Plenum Investments Ltd. said today that it has experienced solid growth of its cat bond fund strategy over the last year, as total assets under management reached $350 million.

We understand that the pricing has now been set for U.S. primary insurance firm Nationwide Mutual’s latest catastrophe bond issuance, the recently upsized to $450 million Caelus Re V Ltd. (Series 2018-1), with three of the four tranches priced below initial guidance and the fourth at the mid-point.

The latest catastrophe bond to be sponsored by Florida’s Citizens Property Insurance Corp. looks set to achieve pricing at or below the middle of initial guidance, as indications suggest that the $200 million Everglades Re II Ltd. (Series 2018-1) will tighten at the lower-end of the launch pricing.

Activities related to capital market transactions such as catastrophe bonds in the first-quarter of 2018 added to strong reinsurance broking revenue growth for Aon plc, as the investment banking side of the broking business continued to drive attractive fees.

U.S. primary insurance firm Nationwide Mutual’s return to the catastrophe bond market in 2018 looks set to result in a bumper issuance, as the still-being-marketed Caelus Re V Ltd. (Series 2018-1) has grown by 50% to now offer investors $450 million of U.S. catastrophe risk exposed notes.

Global broker and advisory Willis Towers Watson has announced that it is to integrate its insurance-linked securities (ILS) offering into its reinsurance broking division Willis Re, a step that will differentiate it from other brokers that keep ILS in their investment banking unit.