The Massachusetts Property Insurance Underwriting Association (MPIUA) is now seeking lower pricing for its latest catastrophe bond, while the target remains to secure $150 million or more in multi-peril aggregate reinsurance protection through the Mayflower Re Ltd. (Series 2026-1) issuance, Artemis has learned.
The MPIUA was last in the market in 2025, securing $225 million of reinsurance from the offering.
You can read about all of the MPIUA’s catastrophe bonds in our extensive Deal Directory.
We’re now told that the target size for this new Mayflower Re 2026-1 catastrophe bond remains unchanged at $150 million, but that the MPIUA is looking to capitalise on the strong price execution being seen for sponsors at this time, with the price guidance now lowered for both of the tranches of notes on offer.
Bermuda-based special purpose insurance vehicle Mayflower Re Ltd. continues to offer investors two tranches of Series 2026-1 notes, each equally sized to provide the MPIUA with $75 million of reinsurance protection.
The notes will provide the MPIUA with a multi-year source of indemnity based and annual aggregate reinsurance covering losses from Massachusetts named storms, severe thunderstorms and winter storms over a three-year term and three annual risk periods, running until the end of June 2029.
Like other cat bonds the MPIUA has sponsored, to qualify an event must breach a $10 million ultimate net loss deductible.
The still $75 million Series 2026-1 Class A tranche of notes come with an initial base expected loss of 1.788% and were first marketed to investors with spread price guidance in a range from 4% to 4.5%. We’re now told that guidance has been lowered to a revised range of 3.5% to 4%.
An also still $75 million Series 2026-1 Class B tranche of notes are riskier, coming with an initial base expected loss of 2.598% and first having been marketed to investors with spread price guidance in a range from 4.75% to 5.25%. We understand the guidance has also been revised lower for these notes, to a new range of 4.25% to 4.75%.
Recall that, residual market insurer the MPIUA has $575 million in cat bond backed reinsurance protection outstanding from its deals currently, but that $250 million of that from a 2023 cat bond sponsorship is scheduled to mature in early July.
At this stage, with no increase to the size of this Mayflower Re 2026-1 cat bond so far, it looks like the MPIUA might not fully replace that expiring cat bond coverage. But, there is still time and if the pricing is conducive we could still see this offering upsize at the last minute.
You can read all about this new Mayflower Re Ltd. (Series 2026-1) catastrophe bond and every other cat bond transaction issued since the market began in the Artemis Deal Directory.
