Insurers, reinsurers urged to improve communications with public (May 01, 2007)

Swiss Re has structured and placed US$150 million [approximately Cdn$172 million] of securities covering flood and earthquake catastrophic events in Canada, Great Britain, and the United States on behalf of Allianz Global Corporate & Specialty AG.

The multi-peril issuance is part of a US$1-billion program designed to provide protection against high-severity losses incurred from earthquakes in Canada or the United States (excluding California) and river floods in Great Britain, according to a Swiss Re release.

In case of a natural catastrophic event of the perils defined, the program would pay a claim based on pre-defined parameters and calculated by the risk modelling company Risk Management Solutions.

The loss caused by an earthquake in Canada or the United States will be based on a modelled loss of a notional portfolio of exposures, Swiss Re says.

If, after an earthquake event, the notional modelled loss amount exceeds pre-defined attachment points, the noteholders will experience a reduction of their principal.

“The transaction attracted considerable investor demand, was over-subscribed and was met by strong interest from a wide variety of investors including dedicated ILS funds, hedge funds, and money managers,” a Swiss Re statement says.

All of the securities have been sold.