Tower Hill secures 67% upsized $375m Winston Re 2026-1 cat bond at lower pricing

Tower Hill Insurance Exchange has now successfully priced its latest catastrophe bond to secure the two-third upsized $375 million of fully-collateralized reinsurance protection against named storm losses in Florida from the Winston Re Ltd. (Series 2026-1) issuance, while each of the three tranches of notes priced well below their initial guidance ranges, Artemis can report.

Tower Hill made its return to the catastrophe bond market at the end of March, initially seeking $225 million of fully-collateralized reinsurance protection against named storm losses in Florida.

In our first update on this Winston Re Series 2026-1 cat bond issuance, we reported that the target size was raised to between $325 million and as much as $375 million, while the price guidance was lowered for the first time.

Then in our second update, Tower Hill continued to target the upper-end in size terms, while the price guidance for the notes were lowered further, while the targeted issuance date had also moved back slightly to allow time for investors to respond to the offering.

We are now told that Tower Hill Insurance Exchange has secured the upper-end of that target, with the notes now all priced and this Winston Re Series 2026-1 catastrophe bond set to provide the insurer with $375 million of fully-collateralized reinsurance protection.

To read about all of Tower Hill Insurance Exchange’s catastrophe bonds filter our extensive Deal Directory by sponsor.

Now priced, this Winston Re Ltd. (Series 2026-1) issuance will provide Tower Hill with Florida named storm reinsurance on an indemnity trigger and per-occurrence basis across a three hurricane season term, beginning June 2026 and with maturity due in 2029.

The first two tranches of Series 2026-1 notes are typical indemnity per-occurrence notes, that run their protection across every event that might attach their coverage, while the third tranche is the first for Tower Hill to be structured on a third event coverage basis.

What was initially a $100 million tranche of Series 2026-1 Class A notes have been priced at $150 million in size. The Class A notes will come with an initial base expected loss of 1.29%.

These notes were originally offered to cat bond investors with spread guidance in a range from 5.5% to 6%, which first fell to a range of between 5% to 5.5% and then later had their pricing reduced again to between 4.5% and 5%. The final pricing was at 4.75%, we understand.

What was also a $100 million Series 2026-1 Class B tranche of notes have also been priced at $150 million in size now.

The Class B notes come with an initial base expected loss of 1.59%. These notes were first offered to cat bond investors with spread guidance in a range from 6.25% to 6.75%, which then fell to 5.75% to 6.25% and then fell again to between 5.25% and 5.75%. The final pricing was at the low-end of revised guidance at 5.25%, we are told.

Lastly, the originally $25 million Class C tranche of notes were upsized to $75 million in size, which is where we understand that the notes have now been finalised.

These Class C notes will come with an initial base expected loss of 0.49%. Originally, these notes were offered to investors with spread guidance in a range from 7% to 7.75%, which first fell to 6.5% to 7% and then fell further to between 6% and 6.5%. The final pricing was at the low-end of the revised guidance at 6%.

As a result, Tower Hill Insurance Exchange has managed to obtain strong execution for its third catastrophe bond, securing two-third’s more reinsurance than initially targeted at pricing levels below the initial guidance.

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.