Swiss Re Insurance-Linked Fund Management

Original Risk: A Society for Change Agents

Clariden Leu arranges novel catastrophe bond transaction


Information is beginning to emerge about a novel transaction undertaken by leading Swiss insurance-linked securities investment company Clariden Leu. We believe the bank has designed this new transaction type in order to create available investment capacity for clients in its cat bond fund.

Details are not very clear as this has been an unrated transaction and no press release was forthcoming. From what we have heard Clariden Leu transformed a $20m U.S. natural peril industry loss warranty (ILW) contract into insurance-linked notes which can then be made tradeable in the secondary market. It’s believed that the ILW can be triggered by a $15b loss although we’re unsure exactly what perils are covered.

Clariden Leu recently stopped accepting new subscriptions to its Cat Bond Fund due to the lack of new investment opportunities in the market. We read this to mean the fund was oversubscribed at the time and the lack of issuance made it impossible to find investments for new clients. It’s possible Clariden Leu have now found a way to create investment opportunities in cat bonds through this method of transforming insurance risk into catastrophe bond notes. This is the first we’ve heard of this type of transaction being issued.

Clariden Leu are now said to be working on a similar deal involving European windstorm risk and may use the PERILS loss index as a trigger.

We’ll bring you more information if it becomes available.

Artemis Live - ILS and reinsurance video interviews and podcastView all of our Artemis Live video interviews and subscribe to our podcast.

All of our Artemis Live insurance-linked securities (ILS), catastrophe bonds and reinsurance video content and video interviews can be accessed online.

Our Artemis Live podcast can be subscribed to using the typical podcast services providers, including Apple, Google, Spotify and more.

Print Friendly, PDF & Email

Artemis Newsletters and Email Alerts

Receive a regular weekly email newsletter update containing all the top news stories, deals and event information

  • This field is for validation purposes and should be left unchanged.

Receive alert notifications by email for every article from Artemis as it gets published.