Catastrophe bonds

The transaction includes a notably high-risk target layer amongst five tranches.

The 2020 start-up raised $115mn from the Montoya Re bond.

The feeder fund to Neuberger Berman ILS strategies took a defensive stance ahead of 2021 Atlantic hurricane season.

The issuance follows on from last year’s $225mn Vista Re offering.

Spreads weighted by volume have increased by 71 basis points year on year.

The Gallagher Re managing director of EMEA North and East said buyers need to be able to explain their stance on handling inflation, going beyond price to include action on their own underlying limits and deductibles, to get reinsurers on board.

Pricing rose to 950 bps, the higher end of guidance.

The issuance takes total cat bond lite issuance to $155.3mn

The bond provides indemnity-based cover for Japan typhoon and flood.

A flurry of selling in the secondary cat bond market is causing “weakness in pricing”, according to a note by Twelve Capital, as sources suggested investors are moving to free up capital for what is expected to be a bumper pre-hurricane season phase.

The pricing on Inigo Insurance’s Montoya Re catastrophe bond has settled at 675 basis points (bps), or the top end of guidance, Trading Risk understands.

Mitsui Sumitomo Insurance Co and Aioi Nissay Dowa Insurance Co have downsized the Tomoni Re catastrophe bond to $190mn-$245mn over two notes, compared with the initial offering of $240mn over four notes of $60mn each, Trading Risk understands.