Pricing moves to top-end for Beazley’s first nat cat bond, Fuchsia 2023-1

Beazley, the London headquartered specialty insurance and reinsurance underwriter, remains on target to secure $100 million in reinsurance from its first ever Rule 144A property catastrophe bond, while pricing has moved towards the top-end for the Fuchsia 2023-1 issuance.

Beazley’s Fuchsia 2023-1 is not only its first property cat bond, it is also the first to use the Lloyd’s owned ILS structure London Bridge 2 PCC Limited for its issuance.

As a reminder, Beazley is also in the market for its first cyber cat bond, the PoleStar Re 2024-1 deal, at the same time.

For this property cat bond, the London Bridge 2 PCC Limited is still targeting issuance of a single $100 million, tranche of Series 2023-1 notes via a protected cell named Fuchsia 2023-1, we understand.

These Fuchsia 2023-1 Series 2023-1 notes will provide Beazley entities with a source of multi-year international property catastrophe reinsurance protection, covering named storm and earthquake events affecting the United States, Canada and certain parts of the Caribbean on an indemnity and per-occurrence over a three-year term.

The still $100 million of Fuchsia 2023-1 cat bond notes come with an initial expected loss of 2.46% and were first marketed to investors with spread guidance in a range from 9% to 10%.

We’re now told that spread guidance has been lifted to the top-end of that range, to pay investors a 10% spread.

Which still seems a reasonable multiple-at-market to pay, based on other recent issuance.

You can read all about this London Bridge 2 PCC Limited (Fuchsia 2023-1) catastrophe bond transaction in our Deal Directory, where you can analyse details of almost every cat bond ever issued.