Specialty insurer Beazley sponsored the first Cyber Insurance Catastrophe (CAT) bond recently, a new type of ILS or insurance linked security issued by a Bermuda entity. They announced the $45 million private placement on January 9, 2023. The bonds provide investors with a generous floating rate of interest and a return of principal in one year, provided that no single catastrophic event occurs across Beazley’s portfolio of cyber insurance policies that results in more than $300 million of losses. Any losses above $300 million incurred by Beazley on those policies as a result of that one event would be absorbed by the investors, up to the $45 million principal amount. The deal was marketed under an NDA, so not all of the details are available, but the bonds will not protect against losses from a state-sponsored cyberattack, which is typically excluded from cyber insurance policies as an act of war.
Catastrophe Claims
Join Locke Lord, AIRROC and Pro. for the Boston Regional Education Day
Wednesday, September 12, 2018
9:00 am – 5:00 pm Eastern
Locke Lord LLP
111 Huntington Avenue, 9th Floor
Boston, MA
The program will feature updates on some of the biggest trending topics for the insurance industry in 2018:
- Hurricane Maria: A Caribbean Cat and the Puerto Rico Insurance Experience
- Insurance
…
Join Us – Locke Lord invites you to the Boston Regional Education Day – September 12
Join Locke Lord, AIRROC and Pro. for the Boston Regional Education Day
Wednesday, September 12, 2018
8:00 am – 5:00 pm Eastern
Locke Lord LLP
111 Huntington Avenue, 9th Floor
Boston, MA
The program will feature updates on some of the biggest trending topics for the insurance industry in 2018:…
TWIA Issues Substantial Harvey Assessment
The Texas Windstorm insurance Association (TWIA) has announced that its board of directors at its May 8, 2018 meeting approved a $175 million member assessment linked to losses arising from Hurricane Harvey. The assessed amount was reportedly lower than initial TWIA staff estimates.
Additional Harvey related assessments may be issued…
Texas Department of Insurance Cautions Insurers Against Unauthorized Market Withdrawals following Hurricane Harvey
On September 15, 2017, the Texas Department of Insurance issued a public bulletin concerning possible insurance company reductions in business following Hurricane Harvey. In Commissioner’s Bulletin #B-0031-17, the Department reminded insurers of the specific Texas statutory thresholds for a reduction in business necessitating a formal withdrawal plan filing with…
Hurricane Maria Insured Losses Potentially as High as $85 Billion
Catastrophe-modeling firm AIR Worldwide estimates that Hurricane Maria caused up to $85 billion in insured losses. Puerto Rico is believed to account for more than 85% of this loss, with an estimated loss range between $40 and $85 billion. AIR’s estimate includes demand surge, which accounts for higher rebuilding costs…
ILS Market: A Deep Dive into the Harvey and Irma Waters
Yesterday, Locke Lord touched on the general implications of the recent devastation caused by Hurricanes Harvey and Irma on the Insurance-Linked Securities (“ILS”) market here. With Irma having now left the Florida keys (and reportedly having destroyed upwards of 25% of all homes in the area), it is now…
Harvey Shining Limelight on Business Interruption Insurance Industry
As victims of Hurricane Harvey try to assess their (often catastrophic) damages, many business owners are finding that their traditional coverages do not adequately cover the scope of their losses. The National Flood Insurance Program (“NFIP”), the primary governmental flood insurance option, has traditionally provided adequate coverage for homeowners, but…
Uncertainty Surrounds New Texas Insurance Law: Divergent Views Emerge on the Impact of the Texas “Hail Storm Bill” on Hurricane Harvey Claims
Texas Legislature Amends Prompt Pay Statute for Insurance Claims
The Texas Legislature has passed new legislation that amends key provisions of Texas’s Prompt Pay Statute for insurance claims. Most types of insurance companies writing policies in Texas are required to comply with Texas’s Prompt Pay Statute in Chapter 542 of the Texas Insurance Code, and those that do not…