Crédit Agricole’s Pacifica “thrilled” with diversification from Taranis Re cat bond

The recently completed issuance of a debut Taranis Reinsurance DAC 2023 catastrophe bond for Crédit Agricole subsidiary insurer Pacifica was part of a drive to add more diversification to its reinsurance program, the company said this morning.

Pacifica is a property and casualty insurance subsidiary of Crédit Agricole Assurances and the company entered the cat bond market for the first time in early November, as we’ve reported.

With the Taranis Re cat bond, Pacifica had an initial goal to secure €150 million or greater source of reinsurance across a four year term through the end of 2027, to protect it against losses from windstorms and hail storm events affecting France, Monaco and Andorra.

In the end, the Taranis Re cat bond settled to provide Pacifica slightly more reinsurance, at €160 million.

The upsizing helped the debut cat bond for Pacifica meet its “capacity objectives”, the company said today.

Importantly, the first foray to the cat bond market helps the insurer, as it “diversifies Pacifica’s sources of reinsurance protection against catastrophes.”

Pacifica was also delighted with the support it found from the cat bond market investor base.

Guillaume Oreckin, CEO of Pacifica commented, “We are thrilled with the positive response from the investor community to this Cat Bond, placed with more than a dozen capital market investors in Europe, North America and Asia.

“With Taranis Re DAC, we are now able to access reinsurance capacity from the capital markets, efficiently complementing our existing traditional reinsurance and strengthening the resilience of our growing reinsurance cat program.”

The Taranis Re cat bond provides Pacifica with a €110 million source of indemnity and per-occurrence reinsurance against windstorm and hail storm losses through a Class A tranche of notes that upsized by €10 million and priced with an initial risk spread of 8.25%.

It also provides Pacifica with €50 million of aggregate reinsurance on an indemnity basis against just windstorm losses, through the Class B notes that did not upsize and priced with a risk spread of 6%.

The Pacifica example, as a first time sponsor visiting the cat bond market, is a strong one, as it secured European catastrophe reinsurance, both on an occurrence and aggregate basis, while also locking that in for four years and citing its appetite to diversify its sources of protection.

That’s a story that will resonate with other European reinsurance buyers.

Read all about this new Taranis Reinsurance DAC 2023  catastrophe bond and view details of more than 950 other cat bond transactions in the Artemis Deal Directory.