Willis Towers Watson’s investment banking business has structured and placed €90 million (approximately NZ$152.8 million) of insurance-linked securities (ILS) for France’s largest domestic P&C (property and casualty) insurance group.

Announcing the completion of the catastrophe bond, Willis Towers Watson Securities said Hexagon Reinsurance DAC settled on December 15 and provides Covéa Mutual Insurance Group with two €45 million tranches of fully collateralised protection against windstorm risk in France for a period of four years.

“We are proud to have supported Covéa in its inaugural catastrophe bond transaction,” said Bill Dubinsky, head of ILS at Willis Towers Watson Securities. “Investors were eager to support the transaction. Hexagon diversifies Covéa’s sources of reinsurance capacity with competitive pricing.
 
“This is a unique transaction as it is the first time a European catastrophe bond has supported capacity at the bottom of a traditional reinsurance program, as well as the first time a European indemnity-trigger catastrophe bond was placed on an annual aggregate basis.”

The transaction was executed in collaboration with Willis Re, the reinsurance business of Willis Towers Watson.
 
“We are delighted at the multiple results achieved in this transaction,” commented Alkis Tsimaratos, managing director of Willis Re EMEA W/S. “In addition to opening up a new source of capital for Covéa’s reinsurance strategy, Hexagon offers a stable multi-year commitment at attractive terms, in the middle of a challenging renewal market, marked by future price uncertainties.”

Tsimaratos noted that this also shows that attachment levels usually reserved for traditional structures in Europe are equally attracting catastrophe bond investors.


Related stories:
Fitch on good news for major European reinsurers
Willis Towers Watson revamps predictive modelling software