Allied Trust Insurance Company has now secured its targeted $100 million of fully-collateralized named storm reinsurance protection from the capital markets through its second catastrophe bond sponsorship, with the issuance now priced, Artemis has learned.Allied Trust Insurance Company had returned to the market for its second catastrophe bond sponsorship earlier this month.The initial target was to secure $100 million of named storm reinsurance covering the states of Texas, North Carolina, South Carolina and Louisiana, similar to its first transaction.Now, we’ve learned that the insurer has successfully priced its second cat bond sponsorship, securing the targeted protection at reduced pricing.

Sabine Re Ltd.will now issue and sell to investors a single $100 million tranche of Series 2026-1 Class A cat bond notes that will provide Allied Trust with a three-year source of named storm reinsurance protection, covering losses in the states of Texas, North Carolina, South Carolina and Louisiana, on an indemnity trigger and per-occurrence basis over a four-year term.During the marketing of this cat bond the layer it will cover was adjusted, with the exhaustion point being reduced.

As a result, the final risk metrics for the notes are that the Sabine Re Ltd.Series 2026-1 Class A notes will cover a share of Allied Trust’s losses from an attachment point of $25 million, up to exhaustion at $125 million.As a result, the Class A notes will have the same initial attachment probability of 1.4%, but a slightly adjusted higher initial base expected loss of 0.99%.

Initially the notes were offered to cat bond investors with price guidance for a risk interest spread in a range from 5.5% to 6.25%.We’re now told that the $100 million of notes will pay investors an initial risk interest spread of 5.5%, so at the bottom end of the guidance range.As a comparison, Allied Trust’s first Sabine Re 2024-1 cat bond came with an initial expected loss of 1.48% and priced to pay investors a spread of 8.25%.

It’s encouraging to see Allied Trust spreading its catastrophe bond coverage through its reinsurance tower and staggering the maturities of its issuances, showing another sponsor becoming increasingly familiar with these multi-year reinsurance structures.You can read all about this new   catastrophe bond and every other cat bond transaction ever issued in the extensive Artemis Deal Directory..All of our Artemis Live insurance-linked securities (ILS), catastrophe bonds and reinsurance can be accessed online.

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