Tower Hill lifts Winston Re 2026-1 cat bond target to as much as $375m

Tower Hill Insurance Exchange is aiming to upsize its new catastrophe bond sponsorship, with the revised target now being to secure as much as $375 million of reinsurance protection against named storm losses in Florida from the Winston Re Ltd. (Series 2026-1) issuance, while pricing has dropped for all three tranches of notes on offer, Artemis understands.

Tower Hill Insurance Exchange, a Florida homeowners and commercial property insurance underwriter, sponsored its debut catastrophe bond back in 2024, which secured the firm with $400 million of reinsurance from its Winston Re 2024-1 issuance.

The company then returned to the market in 2025, and managed to successfully secure a $175 million Winston Re Ltd. (Series 2025-1) cat bond issuance.

Tower Hill returned to the catastrophe bond market at the end of March, with an initial target to secure $225 million of protection against named storm losses in Florida.

Now, the target size for this Winston Re Ltd. (Series 2026-1) has been raised to as much as $375 million, while the price guidance has been lowered for all three tranches of notes on offer.

The reinsurance protection from the Winston Re Series 2026-1 notes will be structured on an indemnity trigger and per-occurrence basis, which will run across a three hurricane season term, beginning June 2026 and with maturity due in 2029.

As we previously explained, for the first time, while two tranches are typical indemnity occurrence notes that run their protection across every event that might attach their coverage, the third tranche is the first to be structured on a third event coverage basis for Tower Hill.

What was a $100 million tranche of Series 2026-1 Class A notes are now being pitched at an upsized range between $125 million and $150 million in size. These notes will provide Tower Hill with reinsurance protection from an initial attachment point of $900 million to exhaustion at $1.1 billion of losses.

The Class A notes will come with an initial attachment probability of 1.42%, an initial base expected loss of 1.29%, and these notes were originally being offered to investors with spread guidance in a range from 5.5% to 6%, but these have now been lowered to an updated range spread of between 5% to 5.5%.

What was also a $100 million Series 2026-1 Class B tranche of notes are now also being pitched an upsized range of between $125 million and $150 million in size. These notes will provide Tower Hill with reinsurance protection from an initial attachment point of $700 million to exhaustion at $900 million of losses.

The Class B notes come with an initial attachment probability of 1.86%, an initial base expected loss of 1.59%, and these were originally being offered to investors with spread guidance in a range from 6.25% to 6.75%, but these have also now been lowered to an updated range spread of between 5.75% to 6.25%.

Lastly, what was a $25 million Class C tranche of notes have now been upsized to $75 million. The notes will cover third events only, from an attachment of $25 million up to exhaustion at $100 million.

The Class C notes will come with an initial attachment probability of 0.92%, an initial base expected loss of 0.49%, and these notes were originally offered to investors with spread guidance in a range from 7% to 7.75%, but these have now been lowered to an updated spread of between 6.5% to 7%, we are told.

Tower Hill Insurance Exchange is looking to maximise its opportunity to bulk up on reinsurance from the capital markets with its latest issuance, capitalising on the strong demand being seen from the cat bond investor base for new issues, in order to increase its protection and reduce the cost of it.

As a reminder, you can read all about this Winston Re Ltd. (Series 2026-1) in the extensive Artemis Deal Directory that includes details on almost every cat bond ever issued.