The Aon-brokered 144A excess of loss cat bond provides $100m of multi-year protection for named storm and earthquake events affecting the US, Canada and Caribbean.
Lloyd’s of London has announced its first 144A catastrophe bond through its London Bridge 2 PCC investment structure.
Beazley is the sponsor of the $100m transaction, on behalf of its Lloyd’s syndicates 623, 2623 and 3623 and its North American and European arms, according to Lloyd’s, the London re/insurance market.
The indemnity reinsurance coverage provides multi-year protection for named storm and earthquake events affecting the US, Canada and parts of the Caribbean.
The transaction brings the aggregate issuance of securities to institutional investors by the London Bridge vehicles to approximately $750m, across 13 cells, Lloyd’s said.
Aon Securities was the sole structuring and book building agent and Mayer Brown acted as deal counsel, Lloyd’s added.
Burkhard Keese, chief financial officer, Lloyd’s, said: “We are very pleased to see the efficient close of the first excess of loss cat bond transaction by London Bridge 2.
“This is another important milestone for this strategically important risk transformation vehicle for the Lloyd’s market and reaffirms the flexibility this vehicle has, provided by its regulatory permissions.
“We are delighted that Beazley has been the pioneer for this new issuance, which confirms our belief that the UK market, and Lloyd’s in particular, is a great place for institutional investors to gain access to global re/insurance risk.”
Adrian Cox, CEO of Beazley, said: “Beazley is delighted to be sponsoring the first 144A property catastrophe bond utilising the London Bridge platform. We were impressed with the smooth and efficient way that an ILS transaction can be issued out of the UK market and we are grateful for the support received from Lloyd’s and Artex throughout the process.”
Richard Pennay, CEO ILS of Aon Securities, said: “We are proud to have acted as sole structuring agent and bookrunner on not only the inaugural excess of loss catastrophe bond by London Bridge 2 but importantly Beazley’s first property catastrophe bond transaction.
“From a transaction timeline perspective the use of the UK PCC allowed for a seamless and efficient execution timeline and was well received by the investor community,” Pennay added.