Allied Trust gets $100m Sabine Re cat bond priced, but settlement falls into April
First-time catastrophe bond sponsor Allied Trust Insurance Company has now secured the targeted $100 million in fully-collateralized reinsurance from its debut Sabine Re Ltd. (Series 2024-1) catastrophe bond issuance, but settlement of the deal has been pushed back slightly into April, Artemis has learned.
Allied Trust Insurance Company, an admitted P&C insurer headquartered in Texas that underwrites property-related and homeowners insurance in Texas, Louisiana, North Carolina and South Carolina, had entered the catastrophe bond market for the first time almost three weeks ago.
It’s target was to secure $100 million in fully-collateralized named storm reinsurance protection from the capital markets through the Sabine Re 2024-1 cat bond, with settlement (completion) of the deal’s issuance originally slated to occur this week.
It’s been quiet ever since, but now we’re told the Sabine Re 2024-1 Class A notes have been priced today and that the settlement date will now be April 2nd.
Which pushes this Sabine Re cat bond into the second-quarter for reporting purposes for our own reports and those of the broker-dealers.
With this cat bond having priced today, Bermuda based Sabine Re Ltd. will issue a single tranche of Series 2024-1 Class A cat bond notes that will provide Allied Trust with a $100 million three-year source of named storm reinsurance protection, covering losses in the states of Texas, North Carolina, South Carolina and Louisiana.
The named storm reinsurance protection will be on an indemnity trigger and per-occurrence basis, with maturity due at the start of April 2027.
The $100 million of Class A notes will attach their indemnity reinsurance coverage at $200 million of losses to Allied Trust and exhaust their coverage at $360 million.
The notes come with an initial base expected loss of 1.48% and were initially offered to cat bond investors with price guidance in a range from 8% to 8.75%, but we’re now told the notes have been priced to pay investors a spread of 8.25% which is within the lower half of initial guidance.
The Sabine Re catastrophe bond now adds to a busy April pipeline, becoming the first deal of already eight now scheduled to settle next month.
It’s good to see Allied Trust securing its debut catastrophe bond backed slice of reinsurance, as another growing carrier that could make significant use of the cat bond market over the coming years, given its position as an underwriter in hurricane-exposed states.
You can read all about this new Sabine Re Ltd. (Series 2024-1) catastrophe bond and every other cat bond transaction ever issued in the extensive Artemis Deal Directory.
