Goldman Sachs and Aon Benfield joint underwriters on Montana Re

The revival of the cat bond sector continues with the issue of a $120m three year bond via Goldman Sachs for Flagstone Re. Aon Benfield is joint underwriter. Risk Management Solutions is modelling agency, with the risk modelling based on RMS's RiskLink Version 9.0. The vehicle is Montana Re Ltd registered in the Cayman Islands.

The cat bond covers U.S. hurricane and earthquake risk, and is rated BB- and B- by S&P (there are two tranches). An industry loss trigger is used. Covered losses are linked to industry losses as calculated by Property Claims Services (PCS).

Montana Re will cover losses resulting from hurricanes in the following states: Alabama, Connecticut, Delaware, the District of Columbia, Florida, Georgia, Louisiana, Maine, Maryland, Massachusetts, Mississippi, New Hampshire, New Jersey, New York, North Carolina, Pennsylvania, Rhode Island, South Carolina, Texas, Vermont, Virginia, and West Virginia. For earthquakes, it will cover losses in the 48 contiguous states and the District of Columbia.