The Travelers Companies, the US property & casualty insurance giant, has now successfully priced what will be its largest catastrophe bond sponsorship ever, securing $750 million of multi-peril reinsurance protection from the new Long Point Re IV Ltd. (Series 2026-1) issuance, Artemis can report.
As we reported in our first update on this deal, the target size of the issuance had been raised to as much as $750 million, while the price guidance had been lowered as Travelers sought strong execution for the cat bond offering.
Now, we’re told that Travelers has secured the upper-end target for $750 million of collateralized catastrophe reinsurance protection from this new Long Point Re VI Series 2026-1 catastrophe bond sponsorship.
At the same time, the notes have been priced at the low-end of reduced guidance for the insurer.
Travelers sponsored its debut catastrophe bond back in 2007, since when it has brought seven further issuances to market.
The most recent cat bond was its $575 million Long Point Re IV Ltd. (Series 2022-1) sponsored around four years ago, it’s biggest at the time.
The reinsurance from that 2022 cat bond is set to mature at the start of June, so with $750 million of reinsurance limit now secured from this 2026-1 issuance, it’s now confirmed the insurer will renew more cat bond coverage than is due to mature.
This new Series 2026-1 cat bond also becomes the largest ever sponsored by Travelers, which is a notable fact when you consider the stature of the insurer and the fact it continues to introduce more capital markets backed reinsurance to its tower.
Read about all of Travelers catastrophe bonds in our extensive Deal Directory.
It is now confirmed that Long Point Re IV Ltd. will issue and sell to investors a single tranche of Series 2026-1 Class A notes sized at between $750 million, to provide reinsurance to a range of Travelers subsidiaries against losses from the same perils as its 2022 cat bond, so U.S. tropical cyclone, earthquake, severe thunderstorm, and winter storm events, across Northeastern U.S. states only.
The $750 million of Long Point Re IV 2026-1 cat bond notes will provide Travelers with this multi-peril northeast US reinsurance on an indemnity trigger and per-occurrence basis across a four year term, with maturity expected to be in early June 2030.
The Class A notes come with an initial base expected loss of 1.38%. They were first offered to cat bond investors with price guidance in a range from 4% to 4.75%, which was later lowered and updated to between 3.5% and 4%.
Now, we’re told the $750 million cat bond offering has been priced to pay investors an initial risk interest spread of 3.5%, so the low-end of revised guidance and below the initial range.
For comparison, Travelers soon to mature 2022 cat bond had an initial expected loss of 1.127% and priced to pay a spread of 4.25%.
Given the softer state of reinsurance pricing in 2026, it’s no surprise the spread multiple of expected loss is lower and so the coverage cheaper for Travelers this year.
You can read all about Travelers new Long Point Re IV Ltd. (Series 2026-1) multi-peril catastrophe bond and every other transaction in the Artemis Deal Directory.
