Florida Citizens now targets up to $600m of reinsurance from Everglades Re II 2026-1 cat bond

Florida’s Citizens Property Insurance Corporation has raised its target for reinsurance protection from its new Everglades Re II Ltd. (Series 2026-1) catastrophe bond sponsorship, with now up to $600 million of named storm limit being sought, Artemis can report.

Florida Citizens returned to the market in April, initially looking to secure $450 million of named storm reinsurance protection from this new Everglades Re II 2026-1 cat bond deal.

We’re now told that the target sizes for all three tranches of notes being offered have been adjusted, with from the initially targeted $450 million to as much as $600 million of reinsurance limit now the goal.

At the same time, sources said that lower pricing is the goal for all three of the tranches of notes, as Florida Citizens looks to benefit from the strong execution being seen in cat bond issuance at this time.

This is the seventeenth series of cat bond notes from Florida Citizens and the fifteenth to use the Everglades Re name, since the property insurer of last resort for Florida’s first sponsorship of a catastrophe bond back in 2012.

Read about every one of Florida Citizens catastrophe bonds in our extensive Deal Directory.

Everglades Re II Ltd. if offering investors three tranches of Series 2026-1 cat bond notes to provide Florida Citizens with multi-year annual aggregate named storm reinsurance covering the state of Florida, on an indemnity trigger basis, across a three year term and three risk periods.

Interestingly, $600 million was a figure that had been discussed as the maximum Florida Citizens was likely to secure in 2026 from the cat bond market as its reinsurance needs have declined alongside its steady reduction in policies-in-force and exposure, in advance of the hurricane season.

That now seems possible, if the insurer of last resort can secure the coverage at the reduced pricing levels it is now seeking.

What was initially a $125 million tranche of Series 2026-1 Class A notes are now targeted at between that amount and $175 million in size.

The Class A notes have an initial base expected loss of 1.35% and were first offered to investors with spread price guidance in a range from 6% to 6.5%. We’re now told the price guidance has been lowered to between 5.5% and 6%.

What was initially a $150 million tranche of Series 2026-1 Class B notes are now targeted to be from that size up to $200 million, we understand.

The Class B notes have an initial base expected loss of 1.74% and were initially offered to investors with spread price guidance in a range from 7% to 7.5%. That has now also been lowered to a revised range of 6.5% to 7%, we are told.

What was initially the final $175 million tranche of Series 2026-1 Class C notes are now targeted at from that size up to $225 million, sources said.

The Class C notes have an initial base expected loss of 2.41% and were first offered to investors with spread price guidance in a range from 8.75% to 9.25%. Again, we’re told that the price guidance range has been lowered to between 8.25% and 8.75%.

As a result, Florida Citizens could upsize its latest cat bond issuance by as much as one-third, while pricing looks set to come in at the low-ends of guidance or even below, depending on the investor response.

If the upper-size target of $600 million is achieved, then Florida Citizens may only require around $530 million of traditional reinsurance for the 2026 hurricane season, with its catastrophe bonds making up the larger component of the risk transfer tower, given protection of just around $2.8 billion is anticipated to be required by the insurer.

You can read all about this new Everglades Re II Ltd. (Series 2026-1) catastrophe bond being sponsored by Florida’s Citizens Property Insurance Corporation and view details of more than 1,000 other cat bond issuances in the extensive Artemis Deal Directory.