Flood catastrophe bond news

FEMA has renewed the National Flood Insurance Program’s (NFIP) traditional reinsurance tower for 2025, securing 22% more in protection for this calendar year, at just over $757.8 million, from a broader panel of reinsurer counterparties.

Artemis has learned that FEMA has increased its estimate for National Flood Insurance Program (NFIP) losses from hurricane Helene, raising the figure to $6.75 billion and as a result two FloodSmart Re catastrophe bond tranches have had their maturity dates extended, with partial repayments of principal to be made.

Moody’s RMS Event Response has said that it estimates private market insurance industry losses from hurricane Helene will be in a range from $8 billion to as much as $14 billion, one of the highest estimates seen so far.

CoreLogic has now updated its insurance market loss estimate for hurricane Helene to include losses to the National Flood Insurance Program (NFIP), now putting the total in a range from $10.5 billion to as much as $17.5 billion.

In conversations with sources in the reinsurance, catastrophe bond and insurance-linked securities (ILS) investments space, it seems some nerves are beginning to emerge over hurricane Helene’s potential to attach certain contracts, as data points begin to suggest a growing claims burden that could result in industry losses creeping higher.

Investment manager Twelve Capital has issued an updated event report related to hurricane Helene’s impacts, saying that it still believes direct losses to per-occurrence catastrophe bonds are unlikely, but also notes that it is closely monitoring the NFIP FloodSmart Re cat bonds that cover named storm induced flooding.

According to analysis from ICEYE, the provider of satellite data and services to inform decision-making and analysis, hurricane Helene’s flooding saw over 100,000 buildings impacted, with more than 10,000 of those being inundated to flood depths of greater than 5 feet.

This morning, we’re told that the significant flooding from rains associated with hurricane Helene throughout southeastern parts of the United States are bringing FEMA’s National Flood Insurance Program (NFIP) reinsurance tower and catastrophe bonds into some focus, although there is uncertainty over how a predecessor rainfall event prior to the storm even making landfall could […]

Reinsurance broker Guy Carpenter is rolling out a new parametric flood product that has been designed to enable risk transfer for large portfolios of exposure across wide-areas. The FloodShield triggers are structured with the help of Floodbase, KatRisk, and ICEYE, plus this could be a solution that utilises ILS market capacity in future.

FEMA has renewed the National Flood Insurance Program’s (NFIP) traditional reinsurance tower at a larger $619.5 million in size for 2024, a 23% increase on the prior year’s placement.