Terra Brasis Re renews $5m cat bond deal with AIG's AlphaCat

AIG's insurance-linked securities (ILS) unit AlphaCat Managers has completed a $5 million private catastrophe bond transaction with Brazilian reinsurer Terra Brasis Re.

The 2019 ‘Alpha Terra Validus III’ bond is the third issuance of this arrangement covering Latin American reinsurance catastrophe risks.

The 2019 notes provide retrocessional reinsurance protection to Terra Brasis Re for property catastrophe exposures, including multi-country earthquake.

The indemnity triggered vehicle is due for maturity on January 15 2020 listed on the Bermuda Stock Exchange (BSX) and placed with AlphaCat investors.

Earlier in January, AlphaCat entered into an ILS transaction with Ledger Capital Markets. The transaction relates to the direct securitization of a non-standard passenger auto insurance portfolio.

Lixin Zeng, chief executive officer of AlphaCat, said: "In 2017 we forged new ground alongside Terra Brasis, bringing ILS into Latin America. Extending our partnership in 2018 and again in 2019 demonstrates ILS is established in the region.”

Rodrigo Botti, chief executive officer of Terra Brasis Re, added: “We are pleased to continue to count AlphaCat as a close partner. Insurance penetration in Latin America has been historically low. Fostering ILS technology in the region will be an important tool to close this protection gap.”

Get all the latest re/insurance industry news with our daily newsletter -  sign up here.

More of today's news

Chubb strikes exclusive distribution deal with top Chilean bank

ILS unit expands with $5m cat bond deal in Latin America

QBE poaches Allianz head of commercial motor

Allied World reveals new head of Bermuda 

Download our survey inforgraphic: 'The Impact of Automation on Commercial Lines'