SafePoint raises Nature Coast Re 2025-1 cat bond target to $150m-$200m

SafePoint Insurance Company has raised the target size for its latest catastrophe bond issuance, with now between $150 million and $200 million of reinsurance protection sought from capital market investors through the Nature Coast Re Ltd. (Series 2025-1) deal, Artemis can report.

It means this new Nature Coast Re cat bond could become the equal largest ever sponsored by insurer SafePoint, if the upper-end of that size target range for the issuance is achieved.

Once completed, this will be SafePoint’s seventh catastrophe bond issuance and its third under this Nature Coast Re program.

However, we have eight from the insurer listed in our Deal Directory, as a 2019 cat bond was not issued as traditional reinsurance was seen as more cost-effective at the time.

With the size target now increased, it appears SafePoint is another sponsor looking to capitalise on strong investor demand for catastrophe bonds and strong deal execution in the market.

As well as increasing the target size, we’re also told that the price guidance for the notes offered has been narrowed within the the initially marketed range.

SafePoint came back to the cat bond market early in December with a $100 million target size for this new Nature Coast Re 2025-1 cat bond.

It is the first time the company has looked to sponsor a catastrophe bond with an industry-loss index trigger, as it seeks multi-year collateralized reinsurance protection for the named storm peril across the states of Florida, Louisiana, Alabama, Mississippi, and Texas.

The notes will also provide reinsurance to cover business underwritten by SafePoint Insurance Company itself and its reciprocal exchanges, the solely Louisiana focused entity Cajun Underwriters Reciprocal Exchange, and the Florida homeowner and business owner focused Manatee Insurance Exchange.

With the updated size target in mind, Nature Coast Re Ltd. is now looking to issue between $150 million and $200 million of Series 2025-1 notes, to provide a roughly four year source of fully-collateralized reinsurance protection against named storm losses in the covered states, on a state-weighted, annual aggregate and industry loss index trigger basis we are told, running from settlement in early 2025 through to the end of 2028.

The Nature Coast Re 2025-1 Class A notes come with an initial expected loss of 2.92% and were initially offered to cat bond investors with spread price guidance in a range from 9.5% to 10.25%, but we’re now told that the guidance has narrowed to a new range of 9.75% to 10%.

As a result, it appears SafePoint is set to finalise this new catastrophe bond at least 50% bigger than its initial target and with pricing somewhere around the middle of the initial guidance, again showing investor appetite for aggregate coverage cat bond notes persists.

You can read all about this new Nature Coast Re Ltd. (Series 2025-1)  catastrophe bond from Safepoint as well as details on every other cat bond ever issued in the extensive Artemis Deal Directory.