SageSure adjusts target size for largest Gateway Re cat bond, now $645m to $690m

SageSure has adjusted the size target for its latest catastrophe bond with now between $645 million and $690 million of broad multi-peril reinsurance sought from the Gateway Re Ltd. (Series 2026-1) issuance, putting it still on track to become the largest in the Gateway series of deals so far, Artemis can report.

SageSure, the fast-growing catastrophe-exposed property specialist MGU, was initially seeking $765 million with this new catastrophe bond offering when the deal first emerged back at the middle of January.

It is the broadest offering in the Gateway Re series of cat bonds so far, seeking multi-peril cover (previously they were all named storm focused) and regional protection across a wider range of states, as SageSure looks to continue to deeply integrate capital markets investor sourced limit via cat bonds within its reinsurance towers.

Within the Gateway Re Ltd. catastrophe bond series , this new Series 2026-1 issuance will be the twelfth since May 2022 once it is settled.

SageSure’s influence continues to grow in the catastrophe bond market, as the company facilitates access to efficient, multi-year, investor backed reinsurance capacity to support its growing portfolio of underwriting companies and partnerships, through the Gateway Re series as well as those for its other related underwriting entities, such as the recent Meritage Re deal and the latest Veraison Re earthquake bond that is currently in the market as well.

For this Series 2026-1 issuance, the Gateway Re Ltd. Bermuda domiciled special purpose insurer (SPI) is still offering five classes of notes to investors, but the original size target of $765 million has now been reduced slightly to between $645 million and $690 million we are now told.

This Gateway Re 2026-1 cat bond will provide SureChoice Underwriters Reciprocal Exchange, Elevate Reciprocal Exchange and SafeChoice Insurance Company with broad multi-peril and multi-regional US reinsurance protection, on an indemnity trigger basis over a three-year term from July 1st 2026.

The cat bond will provide reinsurance to protect the SageSure underwriting entities against certain losses from named storms, earthquakes, severe thunderstorms, winter storms and wildfires across parts of the United States, but with regional and peril differences to each tranche of Series 2026-1 notes that Gateway Re Ltd. is offering.

There have been adjustments to the sizes of three of the tranches on offer, but the price guidance has not been updated for any of the five classes of notes, we understand.

What was a $200 million tranche of Class AAAA notes are now offered at $160 million in size, we understand. They are designed to provide indemnity, occurrence coverage for named storm losses in the states of Alabama, Florida, Louisiana, Mississippi, New York, North Carolina, South Carolina, and Texas. These notes come with an initial expected loss of 0.57% and they are still offered with price guidance for a risk interest spread of between 3.5% and 4%.

What was a $135 million tranche of Class AAA-1 notes are now offered at between $125 million and $150 million in size. These notes are also designed to provide indemnity, occurrence coverage against named storm losses in the states of Alabama, Florida, Louisiana, Mississippi, New York, North Carolina, South Carolina, and Texas. They have an initial expected loss of 0.79% and still come with price guidance for a risk interest spread of between 4% and 4.5%.

What was a $150 million tranche of Class AAA-2 notes are now offered at between $80 million and $100 million in size. These notes are designed to provide two sections of cover, indemnity, occurrence in one section and aggregate third-event cover in another. These notes will cover losses from the perils of named storms, earthquakes, severe thunderstorms, winter storms and wildfires in the states of Alabama, California, Florida, Louisiana, Mississippi, New York, North Carolina, South Carolina and Texas so a slightly wider area of coverage as well. They have an initial expected loss of 1.51% and still come with price guidance for a risk interest spread of between 5.5% and 6.25%.

There has been no size adjustment to the final two tranches, which remain as below.

An $80 million tranche of Class AA notes are designed to provide indemnity, occurrence cover for losses from the perils of named storms, earthquakes, severe thunderstorms, winter storms and wildfires in the states of Alabama, California, Florida, Louisiana, Mississippi, New York, North Carolina, South Carolina and Texas. With an initial expected loss of 2.12%, they still come with price guidance for a risk interest spread of between 6.5% and 7.25%.

The final $200 million tranche of Class A notes are also designed to provide indemnity, occurrence cover for losses from the perils of named storms, earthquakes, severe thunderstorms, winter storms and wildfires in the states of Alabama, California, Florida, Louisiana, Mississippi, New York, North Carolina, South Carolina and Texas With an initial expected loss of 3.98%, they also still come with price guidance for a risk interest spread of between 9.25% and 10%.

While the size targets have adjusted, likely in response to investor demand and price indications received, at between $645 million and $690 million this is still set to be the largest Gateway Re cat bond in the series for SageSure.

Prior to this, the largest in the Gateway Re cat bond series was a $520 million Gateway Re Ltd. (Series 2025-1) issuance.

This new offering remains on course to eclipse that, while still targeting the broadest coverage in peril and regional terms of any cat bond in the Gateway Re series as well.

You can read all about this new Gateway Re Ltd. (Series 2026-1) catastrophe bond and every other cat bond deal in the Artemis Deal Directory.