2024 to see surge in cyber cat bond investments, top broker predicts
Reinsurance broker Gallagher Re predicts a surge in cyber catastrophe bond investments in 2024, spurred by the successful debut of PoleStar Re (Series 2024-1) in December 2023.
PoleStar Re was the first 144A cyber catastrophe bond for Beazley, providing cover of $140 million. It secured the largest capital up-size of any cyber catastrophe bond. Gallagher Securities acted as the sole structuring and book building agent.
Gallagher Re said its cyber team had pioneered the cyber catastrophe bond market with Beazley, providing over $80 million of agency-placed cat light bonds (Cairney I, II and III).
According to Gallagher Securities’ head of cyber ILS, Theo Norris, more investment in cyber cat bonds can be expected this year.
“We have long held the belief that cyber risks are investable with the right structure and investor knowledge,” Norris said. “Presenting cyber expertise directly to investors was fundamental to our success with PoleStar Re, combined with the right structuring and strategy.”
Gallagher Re CEO Tom Wakefield (pictured), added: “Our continued support of Beazley’s cyber capital expansion through PoleStar Re will further accelerate capital market investment in cyber more broadly. We have now taken the next step into 144A bonds – but the journey does not end here. We remain dedicated to developing further Cyber ILS products for the capital benefit of our clients.”
Gallagher Re placed the market’s first collateralised re cyber trade in 2017, and more recently structured and launched the market’s first retrocession cyber ILW for Swiss Re with a $50 million limit. RMS acted as modelling agent for PoleStar Re.
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