One Alliance North America Insurance Company becomes the latest first-time catastrophe bond sponsor, as the company is seeking $100 million or more in multi-peril reinsurance from its debut One Shield Re Ltd. (Series 2026-1) issuance, Artemis has learned.
One Alliance North America Insurance Company is a US domestic market homeowners and commercial lines specialist, now looking to bring the capital markets into its reinsurance tower on a multi-year basis through its first catastrophe bond.
One Shield Re Ltd. has been established in Bermuda to issue series of catastrophe bond notes.
For its first issuance, One Shield Re Ltd. is offering a single Class A tranche of Series 2026-1 notes to investors, with the proceeds from their sale set to collateralize a reinsurance agreement with the sponsor, One Alliance North America.
The offering is initially sized at $100 million, while it is designed to provide the sponsor with a three-year source of named storm and wildfire reinsurance, on an indemnity trigger and per-occurrence basis, running from issuance through to April 2029, we are told.
On the coverage, the named storm reinsurance is for the states of Florida, Georgia, Hawaii, North Carolina, South Carolina and Texas, while the fire protection is solely for the state of California, we understand.
The $100 million of Class A notes that One Shield Re Ltd. is offering would attach their coverage at $95 million of losses and exhaust at $220 million, so cover a share of a larger layer. There is likely stated reinsurance to consider, which would make an effective first-event attachment point higher.
The One Shield Re Series 2026-1 Class A notes have an initial attachment probability of 4.55%, an initial base expected loss of 2.45% and they are being offered to investors with price guidance for a risk interest spread of between 7.5% and 8.25%, sources explained.
The market will welcome the continued flow of new sponsors, as they imply continuing catastrophe bond market growth. Sponsors tend to become repeat visitors to the market over-time and once the hurdle of a first cat bond has been cleared, more often than not the sponsor returns.
Also, it’s worth highlighting that the sole structuring agent and bookrunner for this new cat bond is Lockton Re Capital Markets, marking the first time it has had a sole role on both fronts. Recently it became sole structurer and joint bookrunner for the first time, so it’s encouraging to see the broker-dealer gaining market traction.
You can read all about this One Shield Re Ltd. (Series 2026-1) cat bond and every other catastrophe bond deal ever issued in our Artemis Deal Directory.
