Coastal property reciprocal insurer SURE has closed a $150m private placement catastrophe bond transaction.
A statement from the firm said that it has entered a three-year reinsurance arrangement with Gateway Re, a newly established Bermuda special purpose insurer, which will provide SURE with indemnity-based hurricane and named storm protection in Alabama, Louisiana, Mississippi, and Texas across three full Atlantic hurricane seasons.
Ed Konar, president of the firm, said: “Our catastrophe bond is an essential part of our reinsurance structure and complements a tower backed by industry-leading reinsurers. We are proud to have successfully sponsored our first catastrophe bond that protects our business, backs our strategic growth in coastal markets, and demonstrates strong investor support for our mission.”
The firm said that the transaction had been announced with an initial target of $150m and was oversubscribed. The inaugural issuance closed within initial pricing guidance amidst a market where many catastrophe bond transactions have priced above their initial range or were pulled due to insufficient demand at a target price level.
Swiss Re Capital Markets and TigerRisk Capital Markets & Advisory acted as joint structuring agents and joint bookrunners on the transaction.
More information on the transaction can be found here on our sister website.
