Armonk, NY (Dec. 27, 2021) – Swiss Re Capital Markets successfully closed the USD 160 million Series 2021-1 Principal At-Risk Variable Rate Notes transaction issued by Topanga Re Ltd. on behalf of the companies comprising the Farmers Insurance Group® (“Farmers”). The transaction represents an inaugural issuance to be completed by Farmers and provides collateralized reinsurance protection against named storms, earthquakes, severe weather, and fire that affect the United States.
Swiss Re Capital Markets acted as the joint structuring agent and sole bookrunner.
Farmers’ inaugural transaction consist of two classes of principal at-risk variable rate notes as issued by Topanga Re Ltd., a special purpose vehicle incorporated in Bermuda (the “Issuer”). Through the issuance, Farmers secured USD100 million of per-occurrence protection across a 4-year risk period and USD 60 million of annual aggregate protection across a 2-year risk period, respectively, both on an indemnity basis. The transaction also included an innovative 4-year subrogation extension feature to improve the mechanics by which investors are able to benefit from subrogation recoveries.
Jean-Louis Monnier, Head of Retro & ILS Structuring of Swiss Re’s Alternative Capital Partners, said: “Swiss Re is proud to have advised Farmers in structuring and placing its first-ever catastrophe bond. Investors welcomed the innovative subrogation extension mechanism as it better aligns potential ILS recoveries with those of traditional reinsurance. This innovation was essential to allow Farmers to efficiently complement its per-occurrence and aggregate reinsurance programs with an ILS issuance.”
The Topanga Re Ltd. notes were sold pursuant to Rule 144A of the US Securities Act of 1933, as amended (the “Securities Act”) and have not been registered under the Securities Act or any state securities laws; they may not be offered or sold in the United States except pursuant to an exemption from, or in a transaction not subject to the registration requirements of the Securities Act and applicable state securities laws.
About Swiss Re Capital Markets
In the US, securities products and services are offered through Swiss Re Capital Markets Corporation, a registered broker dealer and a member of FINRA and SIPC. In the European Union, securities products and services are offered through Swiss Re Capital Markets Limited and Swiss Re Capital Markets Europe S.A. Swiss Re Capital Markets Limited is authorized and regulated in the UK by the Financial Conduct Authority. Swiss Re Capital Markets Europe S.A is authorized and supervised in Luxembourg by the Commission de Surveillance du Secteur Financier and the Commissariat aux Assurances and benefits from a passport into certain Member States of the European Union pursuant to the Markets in Financial Instruments Directive 2004/39/EC. Swiss Re Capital Markets Corporation, Swiss Re Capital Markets Limited and Swiss Re Capital Markets Europe S.A, together “Swiss Re Capital Markets”, are wholly owned subsidiaries of Swiss Re Ltd.
About Swiss Re
The Swiss Re Group is one of the world’s leading providers of reinsurance, insurance and other forms of insurance-based risk transfer, working to make the world more resilient. It anticipates and manages risk – from natural catastrophes to climate change, from ageing populations to cyber crime. The aim of the Swiss Re Group is to enable society to thrive and progress, creating new opportunities and solutions for its clients. Headquartered in Zurich, Switzerland, where it was founded in 1863, the Swiss Re Group operates through a network of around 80 offices globally. For more information, please visit www.swissre.com.
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SOURCE: Swiss ReTags: Catastrophe, Farmers, hurricanes, Natural Catastrophes, reinsurance, Swiss Re, United States (USA)