Eclipse Re Ltd., the Artex-managed and operated private syndicated collateralised reinsurance note, private catastrophe bond issuance and reinsurance transformer platform, has completed the issuance of an $8.73 million Eclipse Re Ltd. (Series 2022-2A) transaction in recent days.
This is the second privately placed insurance-linked securities (ILS) transaction of 2022 that we have listed in our extensive Deal Directory from private catastrophe bond transformer and issuance platform Eclipse Re Ltd.
Eclipse Re Ltd. is a Bermuda domiciled special purpose insurer (SPI) and segregated account company that is managed by insurance-linked securities (ILS) market facilitator and service provider Artex Risk Solutions.
This second issuance from Eclipse Re of 2022 is a relatively small transaction, and has a term that suggests this is likely a US wind protection, as it runs through the Atlantic hurricane season.
Eclipse Re Ltd. has issued $8.73 million of Series 2022-02A notes, with the notes having a final maturity date, of January 1st 2023.
Eclipse Re is typically leveraged for the issuance of insurance-linked securities (ILS) notes, via the transformation, securitisation and ultimately transfer to one, or syndication to a group of investors, of reinsurance or retrocession arrangements.
The main use-cases are issuance of privately syndicated collateralised reinsurance notes, or private catastrophe bonds, with an ability to cover a wide range of underlying structures and perils, or lines of insurance business.
Eclipse Re private cat bonds aren’t always broadly syndicated though, with the structure often used as a transformer for an ILS fund manager, to help them securitize a risk and make it investable for a catastrophe bond strategy.
So far in 2022, issuance of private cat bonds is now approaching $500 million.
As ever, we assume this latest Eclipse Re deal features property catastrophe risk-linked notes, providing an unnamed protection buyer, or ILS fund, with reinsurance or retrocession protection just to the end of 2022.
Because of this, there’s a strong chance it’s a protection running for the US wind season, although it could also be a carrier needing a slice of reinsurance from the cat bond market to run up to the January renewals.
The proceeds from the sale of the $8.73 million of private catastrophe bond notes will have been used as collateral to underpin a related reinsurance or retrocession contract, held in a trust.
The $8.73 million of private cat bond notes have been placed with qualified institutional investors and were admitted to the Bermuda Stock Exchange (BSX) as insurance-related securities for a listing, with Artex also acting as the listing sponsor through its Artex Corporate Services (Bermuda) Ltd. unit.
ILS and reinsurance market service provider and facilitator Artex always takes a lead role as the manager for these Eclipse Re Ltd. transactions, with this special purpose vehicle a key part of its ILS infratsurtcure offering to clients.
Update: On collection of additional deal data we’ve now recalculated prior year private catastrophe bond issuance and the total issuance from 2017 has now overtaken 2021, making that the record year at $1.1 billion.