The latest catastrophe bond from U.S. insurer Chubb Group has closed and priced at an upsized $150m. The fifth cat bond from Chubb, East Lane Re V Ltd. began marketing as a $125m cat bond in two Series 2012-1 tranches, seeking a source of collateralized reinsurance cover on an indemnity trigger, per-occurrence basis over a four-year risk period to protect Chubb subsidiaries against certain U.S. hurricanes and severe thunderstorms. The deal upsized by $25m during marketing to secure Chubb $150m of cover by close.
The transaction priced towards the upper end of guidance. The $75m of Class A notes didn’t upsize and priced right at the top end of the range at 9% above Treasury money market funds. The riskier Class B tranche of notes, which have a lower attachment point, upsized to $75m and priced slightly under the top of the guidance range at 10.75% above TMMF.
The cat bond notes issued by East Lane Re V will likely be rated in the next day or so and we’ll update you then.