Hannover Re is back in the catastrophe bond market looking to bolster its North American peak peril retrocession through a new issuance that has an initial target of $200 million and one tranche of which utilises a multi-section approach to provide targeted protection, Artemis can report.This will become the sixth 3264 Re retrocession catastrophe bond from the global reinsurance company and the third in the series in 2025, having secured $150 million of US and Canadian cover in May through the 3264 Re 2025-2 cat bond and prior to that $200 million of worldwide peak peril retro through the issuance.In addition, this year Hannover Re also sponsored a renewal of its parametric cloud outage cyber catastrophe bond, securing $20 million of protection through .While the reinsurer has also fronted the capital markets for numerous cat bond sponsors this year as well.

.With this sixth catastrophe bond under the Bermuda based 3264 Re Ltd.special purpose insurance vehicle, Hannover Re is again looking to secure more retrocessional reinsurance for peak peril industry loss events in the United States and Canada, we are told.

3264 Re Ltd.is set to offer two tranches of Series 2025-3 notes to cat bond investors, with the proceeds from their sale set to collateralize retrocessional reinsurance agreements to benefit sponsor Hannover Re.The two tranches of notes have different coverage structures, the first being an annual aggregate industry loss cover for North American named storms and earthquakes, the second providing two sections of coverage with one an industry-loss occurrence northeast US named storms cover and the other section an industry-loss annual aggregate cover for North American earthquakes.

Both tranches will have three year terms, coming on risk from January 2026, we understand.A currently $100 million Class A tranche of notes will provide annual aggregate named storm and earthquake cover across North America for the US and Canada on an industry loss trigger basis over a three year term.The notes would attach based on annual aggregated index points, after a points based franchise deductible for each peril.

The Class A notes come with an initial attachment probability of 4.04%, an initial expected loss of 3.63% and are being offered to cat bond investors with spread price guidance in a range from 6.25% to 7%, sources said.A Class B tranche of notes are also currently $100 million in terms of target size and will provide two sections of cover.The first being Northeast US named storm cover on a per-occurrence basis, the second being annual aggregate North American earthquake risks (so US and Canada) again with a franchise deductible to be taken into consideration first.

The Class B notes have a combined initial attachment probability of 3.94% and combined initial expected loss of 3.57%.While the first section of Northeast named storm occurrence cover has an initial attachment probability of 2.25% and initial expected loss of 2.04%, but the second section of cover for aggregate NA quakes has an initial attachment probability of 1.7% and initial expected loss of 1.53%.The price guidance for these Class B notes is for a risk interest spread of between 5.5% and 6.25%, Artemis understands.

It’s encouraging to see Hannover Re returning to the cat bond market with its third 3264 Re deal of this year, showing the reinsurance firm building out more capital markets cover within its retrocessional reinsurance arrangements.You can read all about this new catastrophe bond from Hannover Re and every other cat bond issued in the Artemis Deal Directory..All of our Artemis Live insurance-linked securities (ILS), catastrophe bonds and reinsurance can be accessed online.

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