SafePoint seeks $75m Nature Coast Re 2024 cat bond. Acrisure appears for first time
SafePoint Insurance Company is back in the catastrophe bond market seeking $75 million or more in reinsurance from a Nature Coast Re Ltd. (Series 2024-1) cat bond issuance, that is designed to provide broader coverage across more coastal US states and this is the first cat bond we’ve ever seen the Acrisure Re name appear as a service provider.
Back in November, when SafePoint was last in the cat bond market, the company secured $195 million in named storm reinsurance protection from a Nature Coast Re Ltd. (Series 2023-1) issuance that covered losses affecting the states of Florida and Louisiana.
Now, with this Series 2024-1 cat bond issuance from Nature Coast Re, SafePoint is expanding the covered area to now include Florida, Louisiana, Alabama, Mississippi, and Texas, we are told.
In addition to the wider covered area, SafePoint is also including its latest reciprocal insurer as a cedent to this new cat bond as well, meaning the Nature Coast Re 2024-1 cat bond issuance will protect SafePoint Insurance Company, its solely Louisiana focused entity Cajun Underwriters Reciprocal Exchange, and its more recently launched Manatee Insurance Exchange that provides insurance solutions to Florida homeowners and business owners.
This new cat bond from Safepoint is also notable as the first on which we see brokerage Acrisure Re acting as a named service provider.
Acrisure Re Corporate and Advisory Solutions Ltd. is said to be the Swiss and UK placement agent for this deal, the first time Acrisure has featured on a primary cat bond issuance since setting up its new cat bond servicing team in the third-quarter of 2023.
It’s good to see additional choice emerging for sponsors, as an increasing number of brokers feature as cat bond service providers.
This will be SafePoint’s sixth catastrophe bond issuance and its second under this Nature Coast Re program, although we have seven listed in our Deal Directory from the company as a 2019 cat bond was not issued as traditional reinsurance was seen as more cost-effective at the time.
For this Series 2024-1 cat bond, Nature Coast Re Ltd. is looking to issue a single $75 million tranche of Class A notes that will be sold to investors and the proceeds used to collateralize a reinsurance agreement to benefit the SafePoint ceding entities.
The notes will provide SafePoint and its two reciprocal underwriting entities with a roughly four year source of fully-collateralized reinsurance protection against named storm losses in the covered states.
The protection will be on a per-occurrence basis and use an indemnity trigger, running until early June 7th 2028, we understand.
The $75 million of Class A notes feature two attachment points, we are told, for Florida attaching at $300 million in losses and covering a share to $500 million, while for the other states attaching at $600 million of losses and covering a share up to $800 million.
So the layer of SafePoints reinsurance tower where this new Nature Coast Re 2024-1 cat bond will feature is $200 million in size, suggesting that would be a maximum this deal could grow to, if investor interest was sufficiently strong.
The combined attachment point for the notes is 2.59% and expected loss is 1.96%, while for Florida only the EL is said to be 1.11% and the other states 0.87%, suggesting there is more covered exposure in Florida than anywhere else, as you might expect.
In pricing terms, the currently $75 million of Nature Coast Re 2024-1 Class A notes are being offered to investors with spreads in a guidance range from 12.75% to 13.75%, we understand.
It’s good to see SafePoint returning and for the insurer to be looking to expand its catastrophe bond coverage to additional states, as well as to its latest reciprocal underwriting entity.
You can read all about this new Nature Coast Re Ltd. (Series 2024-1) catastrophe bond from Safepoint as well as details on every other cat bond ever issued in the extensive Artemis Deal Directory.
