Heritage Insurance Holdings, Inc., a nationally expansive, Florida headquartered property and casualty insurer, has returned to the catastrophe bond market with a target to secure $200 million or more in collateralized US named storm reinsurance from a issuance, Artemis can report.Heritage Insurance Holdings has been tapping the capital markets for reinsurance in catastrophe bond form since right back in 2014, when it sponsored its first Citrus Re cat bond.This new Citrus Re 2025-1 catastrophe bond will be the .For its tenth Citrus Re cat bond, Heritage is expanding the covered area to include Hawaii for its Zephyr Insurance underwriting company, while also covering risks in Alabama, Florida, Georgia, Mississippi, North Carolina and South Carolina for its Heritage Property & Casualty Insurance Company and Narragansett Bay Insurance Company (NBIC) entities.

Citrus Re Ltd., Heritage’s special purpose insurer (SPI) in Bermuda, will aim to issue two tranches of notes, that will be sold to investors and the proceeds used to collateralize reinsurance agreements for the ceding companies benefit.This Citrus Re Series 2025-1 cat bond notes is targeted to provide Heritage and its subsidiaries with a multi-year source of southeast US named storm reinsurance protection and Hawaii named storm reinsurance protection, on an indemnity trigger and per-occurrence basis, across a three-year term from June 1st 2025 to May 31st 2028, we understand.A $100 million tranche of Class A notes will cover named storm risks across the southeast states and would attach at $700 million of losses and exhaust their reinsurance coverage at $900 million, giving them an initial attachment probability of 1.75%, an initial expected loss of 1.57% and these notes are being offered to investors with spread guidance in a range from 8% to 8.75%, sources said.

A similarly $100 million Class B tranche of notes will cover named storm risks in Hawaii only, with an attachment point at $290 million of losses and exhaust their reinsurance coverage at $495 million, which gives them an initial attachment probability of 1.44%, an initial expected loss of 1.33% and these notes are being offered to investors with spread guidance in a range from 4.5% to 5%, we understand.We also understand there is stated reinsurance related to the two tranches, so the effective attachment points may be different to those mentioned above.It’s good to see Heritage returning for what will be its tenth Citrus Re catastrophe bond and to see the expansion to bring back reinsurance coverage for its Hawaiian entity again through this year’s issuance.

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