Beazley to scale its presence in cyber ILS market: Paul Bantick

Having recently completed the issuance of its debut 144A cyber catastrophe bond issuance, the $140 million PoleStar Re Ltd. (Series 2024-1) deal, Beazley now intends to keep scaling its presence in the cyber insurance-linked securities (ILS) market, Paul Bantick, Global Head of Cyber at the company said today.

The PoleStar Re cyber catastrophe bond was not just Beazley’s debut cyber catastrophe bond, it is also the company’s first 144A cat bond ever to be priced and settled.

Of course, Beazley has also priced and now settled its debut property catastrophe bond as well, the Fuchsia 2023-1 deal, although this priced and settled a few days after the cyber cat bond.

The PoleStar Re cyber cat bond issuance was very successful for the company, eventually securing Beazley $140 million of capital markets backed cyber reinsurance, despite starting the fact the firm had started marketing its debut cyber cat bond at $75 million in size.

Which of course meant that this first Rule 144A cyber cat bond from the company, more than replaced the aggregate $81.5 million of cyber reinsurance protection from Beazley’s three private cyber cat bonds, the Cairney series of insurance-linked securities (ILS), that all matured at year-end.

The PoleStar Re Ltd. Series 2024-1 Class A cyber catastrophe bond notes cover Beazley for remote probability catastrophic and systemic events, using an indemnity trigger on a per-occurrence basis, and running for a two-year term through to the end of 2025.

The company noted that, “Developing a dynamic cyber market and effective solutions for catastrophe risk is vital to increasing the supply of capacity to the cyber (re)insurance market to meet growing demand for cover from business and society.”

Paul Bantick, Global Head of Cyber Risks, then explained, “The cyber market is predicted to treble in size over the next four years. To get there we must keep evolving as a market to ensure we can provide cover for catastrophic events as demand and risk grows. Catastrophe bonds and the ILS market are vital to this.

“Investor interest in our issuance has been strong and their support is testament to the confidence they have in our ability to effectively manage cyber risk.

“Building on the success of the market’s first cyber catastrophe bond programme in 2023, we expect to continue scaling our presence in the cyber insurance linked securities market, encouraging others to do the same.”

Which is encouraging, as Beazley is one of the biggest writers of cyber insurance and reinsurance, so could become a significant issuer of cyber cat bonds, as the market expands and its need for protection increases.

You can read all about this PoleStar Re Ltd. (Series 2024-1)  catastrophe bond transaction to our Deal Directory, where you can analyse details of almost every cat bond ever issued.