Largest private cat bond from Mangrove Risk Solutions to-date, $102.5m 2025-A issuance

The Mangrove Risk Solutions private insurance-linked securities (ILS) platform operated by Marsh McLennan and reinsurance broker Guy Carpenter has issued its largest private catastrophe bond deal so far, with a $102.5 million Mangrove Risk Solutions Bermuda Ltd. (Series 2025-A) that has come to light in July.

It is a particularly large private cat bond, or cat bond lite, although not the biggest ever seen.

But notably, it is bigger than any private cat bonds to have come to market under the Mangrove Risk solutions platform that we have ever reported on.

This private catastrophe bond is the sixth issuance of a cat bond lite that we’ve seen come out of the Mangrove Risk Solutions Bermuda Ltd. platform that is operated by Marsh McLennan and reinsurance broker Guy Carpenter.

Mangrove Risk Solutions Bermuda Ltd. was launched as a new private ILS and cat bond lite platform early in 2024, when Marsh renamed its longer-standing private cat bond platform Isosceles Insurance Ltd.

This $102.5 million Series 2025-A private cat bond from the Mangrove platform is also notably larger than any that came to market under the Isosceles name as well.

This latest private cat bond, or series of privately placed insurance-linked securities (ILS) issued by Mangrove Risk Solutions Bermuda Ltd. is a Series 2025-A arrangement.

Mangrove Risk Solutions Bermuda Ltd. has issued $102.5 million of discounted zero-coupon participating notes, on behalf of one of its segregated accounts named 2025-A.

The notes have been sold to qualified investors and the collateral raised is expected to underpin a reinsurance or retrocession agreement that the segregated cell and trust are subject to.

The $102.5 million of Series 2025-A private cat bond notes that have been issued by the Mangrove vehicle are due for maturity on May 15th 2026, we understand. The notes were privately placed with qualified investors.

As is typical with these private catastrophe bond deals, it’s not clear to us if this is a reinsurance or retrocession deal from the mid-year renewals perhaps, that has taken time to be transformed and securitized, or a freshly arranged reinsurance or retro deal with a term of less than one year.

As with every private ILS or cat bond deal, until we learn more details we assume these cover property catastrophe reinsurance or retrocession risks.

With private cat bonds, in certain cases the risks will have been transformed to enable an ILS fund or investor to source an asset that meets a catastrophe bond mandate, so a transformation from a traditional reinsurance or retro contract.

Or, in other cases, they can see an unknown cedant accessing the capital markets for protection from ILS investors in a more efficient manner than undertaking a full 144A cat bond issuance process.

Private ILS or cat bond lite arrangements usually fit into one of a number of use-cases. Either as a straight collateralised reinsurance or retro cover for a carrier, that has been transformed and securitised, to be assumed by a single ILS fund or investor, or for a small group of funds/investors, or, ILS fund-to-fund transactions (hedging), or the transformation of a specific risk transfer arrangement, such as an industry-loss warranty (ILW).

Guy Carpenter’s specialist capital markets and investment banking unit GC Securities is assumed to have structured the transaction and acted as a bookrunner or placement firm for this Mangrove Risk Solutions private ILS transaction. While Marsh Management Services will have acted as the insurance manager for the structure itself, as has been seen with all the previous issuances under the Mangrove and former Isosceles name.

Being a Bermuda insurance-linked securities (ILS) structure, the private cat bond notes have been listed on the Bermuda Stock Exchange (BSX), which is again an enhancement for liquidity, while Appleby has acted as the listing sponsor for this purpose.

This Series 2025-A issuance from the Mangrove platform came to market just weeks after a much smaller $6.25 million Mangrove Risk Solutions Bermuda Ltd. (Series 2025-D2) private catastrophe bond deal had come to light.

With this latest $102.5 million private catastrophe bond from Mangrove Risk Solutions, private cat bond and ILS issuance tracked by Artemis has now reached $242.75 million for the year so far.

That is still running behind last year and 2023 at this time, which as we’ve said before might reflect the fact more sponsors are graduating to full 144A catastrophe bonds now, or simply meaning fewer of these private deals are coming to light for us to report on.

You can analyse private cat bond issuance by year in our chart that breaks down all our tracked issuance by type here.

2017 was the record year for private cat bonds tracked by Artemis, at just over $1.12 billion of issuance recorded.

Read more about this new Mangrove Risk Solutions Bermuda Ltd. (Series 2025-A)  issuance of private catastrophe bonds in our extensive cat bond Deal Directory.

You can filter our Deal Directory to view only private cat bond deals.