MAPFRE RE, the reinsurance arm of Madrid-headquartered insurer MAPFRE, has announced it is sponsoring the issuance of a catastrophe bond of USD $125 million, issued through Recoletos Re DAC, an special purpose vehicle (SPV) incorporated in Ireland.
This is MAPFRE RE’s first reinsurance protection linked to a cat bond. It is to provide a multi-year protection from January 2025 to December 2027, aiming at enhancing the reinsurer’s retrocession protection.
Catastrophe bonds provide insurers and reinsurers with collateralized protection against disasters, offering an alternative to traditional reinsurance.
The first issuance under this retrocession program, Series 2024-1, provides MAPFRE RE with protection against its catastrophic exposure to tropical storms and hurricanes in the United States, based on the total industry losses reported for these events each year.
Miguel Rosa, CEO of MAPFRE RE, stated: “We’re very satisfied with this new protection because it enables us to expand our business in the United States and diversify our sources of reinsurance, which strengthens our position in the global market.”
AON Securities was the structuring agent of the bond, working jointly on the placement with GC Securities.
MAPFRE RE entered the catastrophe bond market for the first time in November of this year launching Recoletos Re DAC (Series 2024-1), its inaugural catastrophe bond, with the goal of securing $100 million in retrocessional coverage.
In December, the reinsurer increased the size of the bond to $125 million, with reduced pricing due to the strong investor demand.
You can read all about this new Recoletos Re DAC (Series 2024-1) cat bond and view details on almost every other cat bond ever issued in our sister publication’s Artemis Deal Directory.
