SageSure looks set for $100m Gateway Re 2025-3 cat bond at reduced pricing

SageSure now looks set to secure $100 million in U.S. named storm reinsurance protection from its latest catastrophe bond that will protect the Auros and Elevate reciprocal exchanges, while the price for the new Gateway Re Ltd. (Series 2025-3) issuance appears set to finalise below guidance.

SageSure returned to the catastrophe bond market towards the end of June with its latest Gateway Re cat bond, which will become the eleventh in the series.

The company is still looking to secure $100 million in U.S. named storm reinsurance protection from the capital markets for the two reciprocal exchange underwriting entities, the target has yet to change.

Yesterday, we reported that the price guidance for this Gateway Re Ltd. (Series 2025-3) cat bond had slightly lowered and narrowed, with SageSure targeting strong price execution for its latest cat bond deal.

Now, sources have told us that the price guidance has changed once again, with it moving towards the bottom-end of the updated range.

Gateway Re Ltd. is still offering a $100 million single tranche of Class A Series-2025-3 notes to cat bond investors, designed to cover the two reciprocals against losses from named storms initially covering the U.S. states of Louisiana, Mississippi, South Carolina and Texas, on an indemnity, per-occurrence basis.

As we’ve explained before, the notes will only provide their protection across a single hurricane season, coming on-risk after issuance in July, and running through to mid-December 2025.

The $100 million of Class A Series 2025-3 notes that Gateway Re Ltd is set to issue have an initial attachment probability of 3.66%, and an initial expected loss of 1.83%.

As we’ve previously explained, the $100 million of Series 2025-3 Class A notes are structured as discounted zero-coupon notes.

The notes were originally offered with price guidance in a range of 93% to 93.5% of par, roughly equating to a spread-equivalent of between 6.5% and 7% were it a one-year deal (remember the premium covers only around six months).

The price guidance was then updated to between 93.50% to 93.75% of par, which roughly equated to a spread equivalent of 6.25% to 6.5% earned over the term, and we have now been told that it has been revised again to a single figure of 93.75%, so the tightest end and what would be a rough spread equivalent of 6.25%.

We understand this latest movement in price guidance reflects where the Gateway Re Ltd. (Series 2025-3) deal is now expected to be finalised, so we may not provide any further updates unless size or pricing changes again.

As a reminder, you can read all about this new Gateway Re Ltd. (Series 2025-3) catastrophe bond and every other cat bond deal in the Artemis Deal Directory.