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Sanders Re III will provide coverage for the District of Columbia and all US states apart from Florida. -
The carrier has also extended the redemption period by three years, to 31 March 2029.
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The spread guidance has dropped to 7.75%-8.25% from 8.25%-9%.
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The insurer had initially sought a spread range between 6% and 6.75%.
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The insurer confirmed it would be targeting 77% of the original principal amount.
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The bond will provide coverage for any named storm in Texas.
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The firm’s group reinsurance officer Thorsten Fromhold said the insurer will consider using more cat bond coverage “if the market stays where it is”.
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Foundation Re is the carrier’s first entry into the cat bond market for more than a decade.
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The carrier has also lifted the effective coupon to 29.9%.
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The deal will provide annual aggregate cover on a PCS industry loss basis.
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The deal will provide coverage for named storm and earthquake events in the US, Canada and parts of the Caribbean.
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New and returning sponsors, diversifying European wind risks and early placement of US hurricane coverage all helped new issuance to smash market expectations.
