Inigo sees expanded investor demand for second Montoya Re cat bond

Inigo, the Lloyd’s syndicate owner and specialty insurance and reinsurance underwriter, is pleased with the execution of its second catastrophe bond transaction, the $110 million Montoya Re Ltd. (Series 2022-2) deal, especially given its successful placement in a “turbulent” market.

As we had previously explained, Inigo priced the $110 million Montoya Re 2022-2 catastrophe bond this week, and the new issuance will provide the company more than three years of North American named storm and earthquake reinsurance protection on an annual aggregate and industry loss basis, running to the end of March 2026.

Reflecting the turbulent market conditions that Inigo cites, the pricing for its second catastrophe bond rose, with the notes eventually settling with a coupon at the top-end of initial guidance, at 14%.

But positively, Inigo cites an expansion in investor demand for its second Montoya Re catastrophe bond, with more generalist investors subscribing for its notes.

Adam Alvarez, Head of Insight at Inigo, commented on the successful placement of the second Montoya Re cat bond, “We are very pleased to have sponsored our second catastrophe bond just nine months after the first.

“Montoya II will provide Inigo with a further $110m of peak zone protection at a turbulent time in the market – this will bring the total amount of outstanding cat bond limit to $225m.”

Alvarez went on to explain the benefits of the cat bond and the fact that interest came from a wider set of investors this time around.

“We continue to find that the risk appetite of ILS investors is complimentary to other providers of contingent capital,” he explained.

“We were pleased to see that Montoya II attracted investment from both specialist ILS funds and more generalist investors.”

Looking ahead, Inigo appears set to continue building on its catastrophe bond program, with the capital markets likely to remain a core component of its reinsurance and retrocessional protection needs.

“A rolling programme of issuance will further increase Inigo’s ability to support our clients throughout the cycle. We see these types of transaction as an integral part of the way that Inigo finances its business.”

You can read all about this new Montoya Re Ltd. (Series 2022-2) catastrophe bond, the second from Inigo Insurance, as well as details on every other cat bond issued in our extensive Artemis Deal Directory.