Mercury General Corporation, the California headquartered insurer, has now successfully priced its first 144A catastrophe bond, securing the 50% upsized $150 million in reinsurance protection from the capital markets with the  issuance that will cover it for wildfire and fire-following earthquake losses in its home state, Artemis can report.Mercury entered the 144A catastrophe bond market for the first time in June, initially seeking $100 million or more in California fire reinsurance from investors with this debut Luca Re Ltd.deal.As we’ve said before, Mercury had previously sponsored , but this will be the first Rule 144A cat bond for the company.

we revealed that Mercury was looking to upsize its debut 144A catastrophe bond, targeting between the initial $100 million and as much as $150 million of reinsurance.At the same time the price guidance had narrowed to the lower-half of the initial range that was offered to investors.Now, we’re told that Mercury has achieved the larger offering size for its first 144A catastrophe bond sponsorship, while the notes have been priced at the bottom-end of the initial range that was offered to cat bond investors.

The now confirmed $150 million of Luca Re Ltd.Series 2025-1 Class A notes will provide Mercury with a three-year source of collateralized reinsurance against wildfire and fire-following earthquake losses in the state of California, on an indemnity and per-occurrence basis.The Series 2025-1 Class A notes that Luca Re will issue come with an initial expected loss of 1.08%.

The notes were initially offered to cat bond investors with spread price guidance in a range from 7.25% to 7.75%, which then narrowed to 7.25% to 7.5%, and we’re now told have been priced at the lowest end, for a spread of 7.25% to be paid to investors.As a result, another first-time 144A catastrophe bond sponsor has secured more than its initially targeted reinsurance from the capital markets through its debut deal, a strong result for Mercury General Corporation.Wildfire risk has seen growing acceptance in the catastrophe bond market during 2025, which is an encouraging sign of how capital markets are responding to the evolving needs of re/insurers seeking capacity for this challenging peril.

As a reminder, you can read all about this  catastrophe bond and every other cat bond deal in the extensive Artemis Deal Directory..All of our Artemis Live insurance-linked securities (ILS), catastrophe bonds and reinsurance can be accessed online.Our can be subscribed to using the typical podcast services providers, including Apple, Google, Spotify and more.