Catastrophe-exposed property insurance provider SageSure and SureChoice Underwriters Reciprocal Exchange (SURE), a policyholder-owned coastal insurer, have announced the close of a $355 million Rule 144A catastrophe bond.
At this size, the deal is 78% larger than the initial $200 million transaction target and represents the largest cat bond issuance to date since Hurricane Ian.
As part of the transaction, SURE has entered into a three-year reinsurance arrangement with Gateway Re, a Bermuda special purpose insurer, to receive multi-year protection against named storms.
Further details of the deal, and all other cat bond issuances, can be viewed in the Artemis Deal Directory.
“We continue to place significant value on the multi-year and diversified source of reinsurance our catastrophe bond program provides,” said Ed Konar, President of SURE. “Gateway Re is an essential part of our reinsurance structure and allows us to further the important work of protecting property owners in coastal markets.”
SageSure and SURE first entered the cat bond market in May 2022 with its debut Gateway Re Ltd. 2022-1 issuance. The new cat bond expands US named storm coverage across North and South Carolina in addition to the states the previous bond covered: Alabama, Louisiana, Mississippi, and Texas.
“We are excited to see decisive market validation from the global ILS community and appreciate the investor support that led to the bond’s significant upsize,” said Terrence McLean, CEO and co-founder of SageSure. “This transaction supports our ability to provide vital underwriting capacity for our producers in catastrophe-exposed markets.”
Swiss Re Capital Markets acted as the sole structuring agent and bookrunner for the cat bond issuance that secured execution within initial pricing guidance. The Class A tranche doubled in size to $300 million from its initial $150 million target, and the Class B tranche was upsized to $55 million from $50 million.
“Swiss Re Capital Markets is proud to continue our partnership with SageSure and SURE and to guide the largest cat bond issuance since Hurricane Ian,” said Jean-Louis Monnier, the Chief Executive Officer of Swiss Re Capital Markets Corporation. “The impressive response from global investors despite challenging market conditions demonstrates a strong support for reputable sponsors committed to clean cat bond structures and a high level of transparency surrounding exposure growth and reporting.”
