SageSure, a managing general underwriter for catastrophe-prone markets has finalized the issuance of the Gateway Re 2024-1 catastrophe bond, which achieved a closure at $250 million, 67% above the midpoint of its initially targeted range of $100 million to $200 million.
This achievement was made together with SureChoice Underwriters Reciprocal Exchange (SURE), a reciprocal exchange owned by SageSure’s policyholders.
The bond issue had a strong execution, with the pricing of Class AA and Class A notes descending 20% and 17% below the initial midpoint guidance, respectively.
The proceeds from the Gateway Re 2024-1 bond issuance will be used to provide reinsurance coverage against named storms for both SURE and another affiliated reciprocal exchange, Elevate. The coverage spans several states, including Alabama, North Carolina, South Carolina, Louisiana, Mississippi, and Texas, with the flexibility to extend to New York and/or Virginia for the Class AA tranche spanning multiple years.
Swiss Re Capital Markets was key to the process, acting as the sole structuring agent and bookrunner for the Gateway Re 2024-1 issuance.
Ed Konar, president of SURE, remarked on the role that capital markets have played in SURE's reinsurance strategy since 2022.
“The latest Gateway Re catastrophe bond issuance further bolsters SURE’s multi-year named storm reinsurance protection, and we look forward to the measured growth it will support,” Konar said.
Terrence McLean, CEO of SageSure, also expressed pride in assisting their underwriting partners in acquiring long-term reinsurance capabilities through the transaction.
“This transaction brings total catastrophe bond issuances across our underwriting partners to more than $1 billion in only 24 months,” McLean said. “We are grateful to the ILS investor community for their continued support that enables us to serve markets where our solutions make a significant impact.”
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