Jardine Lloyd Thompson Capital Markets (JLTCM), a subsidiary of JLT Towers Re, has arranged Market Re 2014-1, a $10m catastrophe bond.
Market Re will provide indemnity-based collateralised catastrophe reinsurance cover for the cedant's book of business in Florida.
JLTCM said that Market Re was a new vehicle that had been launched to make the capital markets more accessible to issuers looking to do smaller-sized catastrophe bonds.
Rick Miller, Managing Director and co-head of Insurance Linked Securities at JLTCM said that "at JLTCM, we remain focused on the democratisation of the capital markets so that issuance doesn't just remain the domain of larger cedants. We are delighted that we have been able to create a more cost-effective vehicle that will enable cedants to source capital markets capacity for even smaller deals".
Andre Perez, CEO of Bermuda-headquartered ILS management and transformation business The Horseshoe Group, said that "for several years now, we had ILS investors asking for ways to participate in the collateralised reinsurance market via the purchase of tradable notes; they can now do that via Market Re".
The first transaction on the Market Re platform is in the form of other privately placed cat bonds arranged by JLTCM. The modelling has been undertaken by the ILS investment managers rather than by a third-party firm. This, said JLTCM, helps to reduce costs.
JLTCM does not want Market Re to be restricted to one broker. Miller said that other brokers were welcome to use the vehicle, even though it had been launched by a subsidiary of JLT Towers Re.