Allstate is now aiming to secure by far the largest amount of reinsurance limit from a single visit to the catastrophe bond market in its long-history as a sponsor, with now $1.2 billion of multi-peril protection sought from the dual issuances of Sanders Re IV Ltd. (Series 2026-1A) and Sanders Re III Ltd. (Series 2026-1B) cat bond series, Artemis can report.
The two deals both target occurrence protection across the US except for Florida for the insurer and they take the number of Sanders Re issuances we’ve analysed to twenty-four, and makes now twenty-six cat bonds in total that we’ve tracked from Allstate.
In all of those catastrophe bonds, Allstate has never secured more than $950 million of cat bond backed protection in a single month, while that time it was two separate visits in the one calendar month (May 2014) anyway. In terms of single visits, marketed to the investor base in one go, the previous highest amount of limit secured from the cat bond market by Allstate was $750 million.
Read about every cat bond sponsored by Allstate in our Deal Directory.
So, Allstate’s initial target with these dual issuances was to secure up to $500 million of collateralized and multi-year reinsurance limit from the capital markets.
As we reported in our first update on these deals, their target sizes were both lifted from their initial $250 million per-series, to between $450 million and $500 million per-series of notes, so a combined target for between $900 million and $1 billion of catastrophe reinsurance limit.
Now, we’re told that Allstate has raised its target further, with now $600 million of reinsurance sought from each series of notes, for a combined target that now looks likely to secure the insurer $1.2 billion of reinsurance from the capital markets.
Meaning this could become the first billion dollar plus cat bond sponsorship from Allstate, as the company continues to place the capital markets at the heart of its reinsurance towers.
Four tranches of notes remain on offer across the issuances through the more recently set up Sanders Re IV Ltd. and an older vehicle Sanders Re III Ltd., but the target now is for $600 million of limit from each vehicle’s issuance, split across two classes of notes per series, sources said.
All four tranches of notes will provide Allstate with per-occurrence and indemnity triggered catastrophe reinsurance protection across all US states except for Florida, covering personal lines property and auto losses from multiple US perils. Specifically the coverage is for losses from named storm, earthquake, severe weather, wildfire, volcanic eruption, or meteorite impact events, the same perils as all of Allstate’s nationwide ex-Florida cat bond deals.
Allstate’s aim remains to secure a particularly large amount of both four year and five year reinsurance limit from this issuance, as much as $1.2 billion now being sought with the target size updated again.
Under the Sanders Re IV Ltd. vehicle, two tranches of Series 2026-1A notes are being offered with the target now being to secure $600 million of limit between them.
A tranche of Series 2026-1A Class A-1 notes (four year term) and Series 2026-1A Class A-2 notes (five year term) both come with the same initial base expected loss of 0.6851% and were initially offered with price guidance for a risk interest spread of between 3.25% and 4.25%. The spread guidance remains at the updated 3.5% at this time, we are told.
Under the Sanders Re III Ltd. vehicle, two tranches of Series 2026-1B notes are being offered, again with the same target to secure the higher $600 million of reinsurance limit between them.
A tranche of Series 2026-1B Class B-1 notes (four year term) and a tranche of Series 2026-1B Class B-2 notes (five year term) both come with the same initial base expected loss of 1.8874% and were first offered with price guidance for a risk interest spread of between 4.5% and 5.5%. The spread guidance remains at its updated level of 5%, we understand.
As a result, Allstate is firmly on-track to secure its largest single catastrophe bond sponsorship ever, with a huge $1.2 billion of reinsurance limit now looking as the likely end result and pricing remaining at attractive levels for the insurer.
We’ve listed these in separate entries in our Deal Directory, given the two issuance vehicles used.
You can read all about the Sanders Re IV Ltd. (Series 2026-1A) and Sanders Re III Ltd. (Series 2026-1B) cat bonds from Allstate and every other catastrophe bond issuance in the extensive Artemis Deal Directory.
