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Artemis has learned that GeoVera Insurance Holdings, Ltd. is now targeting as much as $400 million in earthquake reinsurance protection from capital market investors through its new Veraison Re Ltd. (Series 2025-1) catastrophe bond.
As we reported earlier this month, GeoVera Insurance Holdings, Ltd ventured back to the cat bond market with an initial target to secure $275 million of earthquake reinsurance protection, from what is set to become the company’s third Veraison Re cat bond.
We have now been told that the company is looking to upsize its latest catastrophe bond, the Veraison Re Ltd. (Series 2025-1), with between $350 million and $400 million of notes expected to be issued through this cat bond deal.
Alongside the target size for this Veraison Re 2025-1 cat bond being increased, we’ve also been told that the price guidance range has been lowered for each of the two tranches of notes on offer.
The insurer had previously sponsored two Veraison Re catastrophe bonds, one in 2023 and one in 2024, that together provide it $325 million of collateralized US earthquake reinsurance protection.
With GeoVera now looking to upsize this Veraison Re Ltd. (Series 2025-1) cat bond to be between $350 to $400 million, it looks set to be its biggest cat bond in the Veraison Re series so far.
GeoVera is again using its Bermuda licensed special purpose insurer (SPI) Veraison Re Ltd. for this Series 2025-1 catastrophe bond issuance.
Veraison Re will issue two tranches of notes, that will be sold to cat bond investors and the proceeds used to collateralize reinsurance agreements between the SPI and GeoVera.
What was a $200 million tranche of Series 2025-1 Class A notes are now targeted to be between $250 million to $275 million in size, sources have said.
The Class A notes will come with an initial attachment probability of 1.79%, an initial expected loss of 1.43%, and were first being offered to investors with price guidance in a range from 4% to 4.5%, but we’re told the updated guidance is for a spread of between 3.50% to 4.00%.
What was a $75 million tranche of Class B notes are now targeted to be between $100 million and $125 million, we are told.
The Class B notes have an initial attachment probability of 2.99%, an initial expected loss of 2.57%, and were first being offered to investors with price guidance in a range from 6% to 6.75%, but this has also fallen to an updated range of 5.50% to 6.00%.
As a result, GeoVera looks set to benefit from strong demand for its latest catastrophe bond, with the deal looking set to increase from the initial targeted size, while pricing could wind up coming in at the low-end of initial guidance or below.
You can read all about this Veraison Re Ltd. (Series 2025-1) in the extensive Artemis Deal Directory that includes details on almost every cat bond ever issued.
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