JLT Capital Market closes $30.8m cat bond

Jardine Lloyd Thompson Capital Markets (JLTCM), part of JLT Re, has closed catastrophe bond Market 2016-5 (Weather) at $30.8 million.

The bond provides single year parametric-based collateralised retrocession coverage for warm-weather winters across Europe through one class.

Ed Hochberg, chief executive officer of JLT Re North America and JLTCM, said: “We continue to service our clients with cutting-edge, innovative, and economical risk transfer solutions. This transaction is a perfect illustration of the overall growth of the capital markets and ILS space. It is particularly noteworthy as it is the first ILS weather trade in nearly two decades."

Michael Popkin, managing director and co-head of insurance-linked securities (ILS) at JLTCM, said that the new bond provides investors with access to both unique European risk and yield which are currently not common in the marketplace.

He added: “We foresee these types of transactions (e.g. parametric, weather-based) becoming more prevalent as the ILS market continues to grow. We received strong interest and support during the marketing of the transaction, signalling that investors are ready to support bespoke, diversifying risks for the appropriate risk-reward levels.”

Rick Miller, managing director and co-head of ILS at JLTCM, said: “Market Re continues to prove its adaptability and efficiency in the marketplace. We see this transaction as a natural extension of both the ILS market and the Market Re platform. We fully expect to bring more Market Re weather deals to market and grow the segment.”