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Swiss Re Secures $130M Catastrophe Bond

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Posted on 11 Nov 2011

Swiss Re has obtained a further USD 130 million in protection through the Successor X Ltd. catastrophe bond programme covering North Atlantic hurricane and European windstorm. The transaction marks the fifth time that Swiss Re has used the Successor X programme to transfer risks into the capital markets.

Swiss Re has entered into a transaction with Successor X to receive up to USD 130 million of payments in the event of European windstorms and of North Atlantic hurricanes of a certain magnitude. The flexible structure of the Successor X programme enables Swiss Re to move quickly in response to market conditions, securing multi-year protection at terms which are attractive to the company and investors.

Covering a four-year period, ending in November 2015, the transaction follows four previous take-downs from the Successor X programme, after a first for USD 150 million in December 2009, a second for USD 120 million in May 2010, a third for USD 170 million in December 2010 and a fourth for USD 305 million in February 2011.

Martin Bisping, Swiss Re's Head of Non-Life Risk Transformation, says:

"After a brief dip in returns in the wake of the Japan earthquake, the ILS marketplace has rebounded, demonstrating the commitment that investors have to catastrophe bonds. Successor X allows us to seize opportunities to transfer risk at favourable terms and to support growing demand for natural catastrophe capacity from our clients."

This transaction combined with prior Successor programmes has allowed Swiss Re to obtain USD 2.39 billion of protection against natural catastrophe events.

"Insurance-linked securities remain a cornerstone of our hedging strategy, giving us a competitive advantage by allowing us to manage peak catastrophe risk more effectively," says Matthias Weber, Swiss Re's Head of the Property and Specialty Division.

The Successor X notes were sold in a private placement pursuant to Rule 144A of the U.S. Securities Act of 1933, as amended, (the “Securities Act”) and have not been, and will not be, registered under the Securities Act or any state securities laws; they may not be offered or sold in the United States except pursuant to an exemption from, or in a transaction not subject to, the registration requirements of the Securities Act and applicable state securities laws.


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