Aon Benfield Securities has successfully underwritten and placed a $276m catastrophe bond issued by VenTerra Re Ltd, which provides
QBE subsidiaries with protection against earthquakes and cyclones.
Aon Benfield Securities acted as joint structuring agent and sole bookrunner on the transaction.
VenTerra Re Ltd. provides subsidiaries of QBE Insurance Group Limited (QBE) with $276m of multi-year collateralised protection against US and Australia earthquakes and Australia cyclones on an indemnity basis for a period of three years commencing January 1, 2014.
VenTerra Re Ltd. is the first-ever catastrophe bond that has secured coverage for Australian perils for a primary insurance company on an indemnity basis.
Jim Fiore, chief reinsurance officer at QBE, said: “We are very happy with the coverage and terms secured via VenTerra Re Ltd., the first catastrophe bond sponsored by our company and which was received very well among investors.”
Paul Schultz, CEO of Aon Benfield Securities, said: “We are pleased to have successfully placed VenTerra Re Ltd. on terms attractive to QBE, with coverage substantially similar to what QBE has been able to secure in the traditional reinsurance market. VenTerra Re Ltd. was very well received by investors, who welcomed the addition of a new sponsor to the market.”
The VenTerra Re Ltd. $276m Series 2013-1 Class A Principal At-Risk Variable Rate Notes were priced at 3.75 percent above the yield on the underlying money market fund collateral. The Notes are rated BB(sf) by Standard & Poor’s and Risk Management Solutions, Inc. provided the risk analysis for the transaction.
