Titania Re III provides $125m of protection for named storms and earthquakes in the US and Canada

Ariel Re has successfully sponsored Titania Re III, the third issuance from Titania Re Ltd. (Series 2023-1 Notes), with a first-of-its-kind carbon offset feature.

Titania Re III is the third cat bond which Ariel Re has sponsored since the initial Titania Re deal in 2021.

Titania Re III provides Ariel Re with $125 million of collateralised reinsurance cover for named storms and earthquakes in all US States, Puerto Rico, the US Virgin Islands and Canada with an industry loss trigger over three years.

Building back greener

In a first for the cat bond market, Ariel Re will seek to buy carbon offset options from a qualified provider to generate carbon credits in the event of a significant hurricane or earthquake that requires a large number of homes, commercial properties and vehicles to be replaced.

Ryan Mather, chief executive officer of Ariel Re, said: “Our vision is to be the premier manager of reinsurance risk, and launching environmentally-friendly initiatives such as Titania Re III for the building back of business and communities in the wake of natural disasters shows that we can be innovative in the reinsurance solutions we provide to our clients.”

Matthew Twilley, head of Ceded at Ariel Re, said: “While there is no directive to build back greener, Ariel Re is taking the initiative to help people and businesses to get back on their feet after natural disasters in a way that reduces the harm done to the planet. We want to do good while helping others to do well.”

The cat bond was successfully closed on February 23, 2023. Howden Tiger Capital Markets & Advisory acted as sole structuring agent and joint bookrunner, with Aon Securities LLC acting as joint bookrunner.