TD Insurance, part of Canada’s TD Bank group, has returned to the catastrophe bond market for its second sponsorship, seeking C$125 million in aggregate reinsurance from the capital markets to cover a broader range of perils than its first cat bond, through a deal, Artemis has learned.TD Insurance secured its debut 144A catastrophe bond a year ago, sponsoring a C$150 million MMIFS Re Ltd.(Series 2025-1) deal that provides it with multi-year indemnity reinsurance for losses from earthquakes and severe convective storms (SCS) in Canada.That was the first catastrophe bond to solely cover natural catastrophe risks in Canada.

While Canadian perils regularly feature in multi-peril cat bonds, TD Insurance was the first Canadian sponsoring insurer and so the first pure Canadian risk cat bond was issued.Now, the company has returned with a goal to secure reinsurance in annual aggregate form from the capital markets with its second cat bond sponsorship, while this deal also introduces new perils as well.Using Bermuda based special purpose insurer MMIFS Re Ltd.

again, a single tranche of Series 2026-1 Class A notes is being offered to investors, which will be sold and the proceeds used to fully-collateralize a reinsurance agreement to protect TD Insurance group underwriting entities, including Security National Insurance, we understand.The Series 2026-1 issuance is currently targeted at C$125 million in size and the goal is to secure multi-year annual aggregate and indemnity triggered reinsurance protection for TD Insurance.That aggregate reinsurance will cover the perils of named storms, earthquakes, severe convective storms (SCS), winter storms and wildfires in Canada, we are told.

So a wider range of perils than its previously sponsored indemnity cat bond.The aggregate reinsurance will run across three annual risk periods, from settlement in early 2026 through to the end of 2028, so a roughly three-year term.The C$125 million of Series 2026-1 Class A notes that MMIFS Re Ltd.

is offering would attach their coverage at C$350 million of losses to TD Insurance, exhausting their protection at C$500 million of losses, we understand.The notes will feature an event deductible of C$25 million in order for a catastrophe loss to qualify for aggregation, while there is also a maximum event contribution set at C$175 million, sources said.That maximum contribution of a qualifying catastrophe loss event means it will take at least two large losses for these notes to attach, it appears.

The notes will come with an initial attachment probability of 4.43%, an initial expected loss of 1.96% and are being offered to cat bond investors with price guidance for an initial risk interest spread in a range from 5% to 5.5%, we are told.As with TD Insurance’s first cat bond deal, as this second issuance is agaian denominated in Canadian dollars, we understand the collateral will again be invested in EBRD notes that pay a return-on-collateral based on just below the Canadian Overnight Repo Rate Average (CORRA).It’s good to see TD Insurance returning and looking to now utilise catastrophe bonds as a way to source efficient aggregate reinsurance protection.

You can read all about this catastrophe bond and every other cat bond ever issued in the 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.