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Twelve Capital’s private Dodeka XV cat bond has maturity extended


For the first time (that we’ve seen) one of the Dodeka series of private catastrophe bonds issued on behalf of specialist insurance and reinsurance linked fund manager Twelve Capital has had its maturity date extended.

Twelve Capital logoThe $9.269 million Dodeka XV private cat bond was issued for Twelve Capital in June 2018 and had an original maturity date of December 27th 2018.

As we understand it the maturity date for the private cat bond notes was extended and currently sits at October 31st 2019, so just a few days away.

These private catastrophe bond deals, under the Dodeka name, are used by ILS fund manager Twelve Capital as a way to source property catastrophe risks in a more liquid and securitized form.

Typically they have involved industry loss warranties (ILW’s) that have been transformed and securitized into a liquid ILS note with secondary trading possible. Although they tend to just be for Twelve Capital’s use within its own catastrophe bond fund strategies we believe.

In this case, given the timing of the issuance in June and its just over six month duration, we assumed that the notes issued under the Dodeka XV private cat bond represent a reinsurance or retrocession contract providing coverage across the duration of the U.S. hurricane season.

Extension of maturity in ILS contracts such as these is business as usual, typically activated when an industry loss or a ceding companies own indemnity requires further time to develop before a final determination can be made as to whether any loss payment is due under the contract.

In this case it seems likely that the ceding company benefiting from the underlying reinsurance or retrocession has opted to extend the maturity to allow for loss development in this way, hence the extension of maturity for the Dodeka XV notes.

Twelve Capital’s series of Dodeka private cat bond transactions have now covered over $500 million of risk capital sourced, transformed and issued in catastrophe bond form since 2014. Details on every Dodeka private cat bond transaction can be found in the Artemis Catastrophe Bond Deal Directory.

These transactions demonstrate ILS fund manager Twelve Capital’s commitment to sourcing reinsurance risks in securitised cat bond form to satisfy its ILS fund investors.

We’ll update you should any further information become available related to this Dodeka XV private cat bond.

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