The two US Coastal named insurance companies administered by Cabrillo Coastal General Insurance Agency are back in the catastrophe bond market for their second sponsorship, with an initial $100 million target for named storm reinsurance from a Chartwell Re Ltd. (Series 2026-1) issuance, Artemis can report.
Now, the insurers are back and seeking to expand on the role catastrophe bonds play in their reinsurance tower, with two new tranches of notes being offered to investors.
The sponsoring insurers are New York domiciled US Coastal Insurance Company and Florida domiciled US Coastal Property & Casualty Insurance Company.
Both operate as homeowners insurance specialists and are administered by hurricane exposed property insurance specialist Cabrillo Coastal General Insurance Agency, part of Cabrillo Holdings, LLC, with Cabrillo’s owners the major stakeholders in the companies.
Following on from their catastrophe bond a year ago, the US Coastal insurers are utilising Chartwell Re Ltd., as they look to expand on their capital markets backed reinsurance from the 144A cat bond market.
For this second issuance, Chartwell Re Ltd. is offering two tranches of Series 2026-1 cat bond notes to investors, with an initial target to secure $100 million of fully-collateralized reinsurance for the US Coastal insurers, we understand from sources.
The Chartwell Re Series 2026-1 cat bond notes will provide catastrophe reinsurance to the two US Coastal insurers sponsoring the deal, on an indemnity trigger and per-occurrence basis, over a three year term and covering named storm losses.
The covered area are the same hurricane exposed states as the first cat bond, the main states the two insurers underwrite business in, which are: Alabama, Florida, Mississippi, New Jersey, New York, Rhode Island, and Texas.
We understand that New York and Florida are the states making the main contribution to the notes expected loss.
We’re told that these two new Series 2026-1 cat bond tranches from Chartwell Re will sit in a stack in the reinsurance tower with the three Series 2025-1 tranches issued a year ago, with the notes reinsurance protection inuring to each other as you move up the stack.
Chartwell Re is offering an initially $55 million tranche of Series 2026-1 Class D notes that will have an initial attachment point at $65 million and exhaust at $120 million, giving them an initial attachment probability of 1.5%, an initial expected loss of 1.32%, while they are being offered to investors with price guidance in a range from 4.75% to 5.5%.
A $45 million tranche of Series 2026-1 Class E notes are also being offered, that will also have an initial attachment point at $65 million and exhaust at $120 million, giving them an initial attachment probability of 7%, an initial expected loss of 5.67%, while they are being offered to investors with price guidance in a range from 12.5% to 13.25%.
We’re told that the Class D notes are set to be the highest layer in the reinsurance tower, while the Class E notes will be the lowest or riskiest, and the three tranches from 2025 will sit between them, each on top of the other.
As a result, these US Coastal insurers are set to have a stack of cat bond protection running up their reinsurance tower, with the capital markets becoming increasingly deeply integrated into the reinsurance program.
You can read all about this new Chartwell Re Ltd. (Series 2026-1) catastrophe bond and almost every other cat bond deal ever issued in the Artemis Deal Directory.
