The Kane SAC Limited Note Program has facilitated another private catastrophe bond issuance, with the issuance of a $50.2m 2015-1 series of insurance-linked notes that have also been listed on the Bermuda Stock Exchange (BSX).
Since the start of 2015 the Kane SAC platform, operated by global independent insurance management firm Kane, has seen a number of privately transacted ILS and catastrophe bond deals completed, with this 2015-1 transaction being the sixth.
The $50.2m of notes have been issued using a Kane SAC Limited Series 1-2015 Segregated Account. The notes have been listed on the BSX as insurance related securities, and have a due date of 7th April 2016.
This looks like it might be a renewal of the $50.12m Kane SAC Limited (Series 2014-1) issuance that came to market just over a year ago. That transaction, a U.S. earthquake linked indemnity private cat bond, also had a due date of 7th April.
We don’t have any details on the perils at risk from the underlying reinsurance contract in this Kane SAC Limited (Series 2015-1) issuance, or the trigger type at this time. We will update you should that information become available.
Private cat bond, or cat bond lite, platforms such as the Kane SAC Limited Note Program provide investors and ILS managers with the ability to access risk in securitized form more cheaply and from smaller transactions that the main 144A cat bond market.
Many investors like pension funds, have mandates that insist on secondary liquidity in their investments, and ILS managers operate funds with liquidity mandates, making securitised notes a prefered option to deploying capital into collateralized reinsurance.
Hence using a platform that allows for an underlying reinsurance contract to be transformed, issued as securitised notes with secondary transferability is becoming increasingly popular.
This transaction has been added to our Deal Directory, where it is the sixth private cat bond (or cat bond lite) of 2015 already.