Everest Group is now targeting as much as an upsized $675 million of multi-peril collateralized North America focused retrocession from its new Kilimanjaro III Re Ltd. (Series 2026-1) and Kilimanjaro III Re Ltd. (Series 2026-2) catastrophe bond transactions, Artemis can report.
Four tranches of notes were being offered under each series, with the Kilimanjaro III Re Ltd. (Series 2026-1) notes targeting three years of coverage and Kilimanjaro III Re Ltd. (Series 2026-2) notes targeting four years of coverage for the firm’s reinsurance entity Everest Re.
Within each of the series there were initially four tranches of notes, two targeting annual aggregate protection and two targeting retro on a per-occurrence basis.
Now, we’re told that two tranches of notes have been withdrawn from the offering, the three-year aggregate Class A1 notes and the four-year occurrence Class C2 notes.
But, across the remaining four tranches being offered the overall target for retrocession has now increased, from the initial at least $530 million to now as much as $675 million, sources have explained.
Which means that, over the two Kilimanjaro Re III cat bond series that are being offered, Everest is now seeking up to $675 million of three and four year retrocession in both aggregate and occurrence formats to cover impacts of major industry loss events named storms and earthquakes that impact the United States, Puerto Rico, U.S. Virgin Islands, D.C., and Canada.
You can read about the full offering in our original article on these cat bond series and in the Deal Directory entries, while below we just detail the new target sizes and pricing for the tranches that remain on offer.
The remaining four-year Series 2026-2 Class A-2 annual aggregate notes are now targeted at $50 million in size (previously that was the amount targeted across both series of A’s, remember the A1’s have been withdrawn). These notes come with an initial base expected loss of 4.35% and were first offered with price guidance in a range from 8% to 8.5%. Now, the guidance has been lowered to from 7.25% to 8%.
The annual aggregate three year Series 2026-1 Class B-1 and four year Series 2026-2 Class B-2 notes now have a target for between the original $100 million and $130 million of retro. They have an initial base expected loss of 6.97% and were first offered with price guidance in a range from 12.25% to 12.75%. Now, the guidance has fallen to between 11.75% and 12.25%, we are told.
The remaining C1 tranche of three-year occurrence notes (the four-year C2’s were withdrawn) are now targeted at between the original $50 million (which was across both C tranches) and now as much as $75 million. They have an initial base expected loss of 5.53% and were initially offered with price guidance in a range from 9% to 9.5%. But that guidance has fallen as well, to now between 8.25% and 9%.
The three year Series 2026-1 Class D-1 and four year Series 2026-2 Class D-2 per-occurrence notes are now targeted at between their initial sizing of $330 million and as much as $420 million across the two tranches. These notes have an initial base expected loss of 7.38% and were first offered with price guidance in a range from 12% to 12.5%. Now, the price guidance has also been lowered, to a revised single figure of 12%, sources said.
Everest is looking set to secure much more retro reinsurance than it initially targeted with this new pair of catastrophe bond series, which will further boost its cat bond protection from the current $1.2 billion of catastrophe bonds outstanding, recorded on our Artemis cat bond sponsor leaderboard.
It remains to be seen whether all the remaining six tranches will get placed, or whether Everest will target a particular tenure of coverage if the appetite from investors is there. Given the uncertainty over which tranches will be placed, we’ve simply split the overall target across our Deal Directory entries for each series until the notes are priced and finalised.
Details of every catastrophe bond sponsored by Everest Re can be found here.
You can read all about the Kilimanjaro III Re Ltd. (Series 2026-1) and Kilimanjaro III Re Ltd. (Series 2026-2)catastrophe bond series from Everest Re and every cat bond transaction ever issued in the extensive Artemis Deal Directory.
