23 November 2020ILS

RMS partners with Willis Re Securities and Securian Financial on mortality cat bond

RMS has partnered with Willis Re Securities and Securian Financial to launch the new La Vie Re series 2020-1 mortality catastrophe bond.

The bond provides $100 million of reinsurance protection for Minnesota Life Insurance Company, a Securian Financial affiliate. Covering the US, it is the first indemnity 144A excess mortality bond that models the cedants’ portfolio on a loss ratio basis.

The notes, issued by La Vie Re, were launched to cat bond investors, and the full $100 million principal was achieved with a coupon price of 2.85 percent.

RMS acted as the modeling agent on the cat bond transaction, providing a view of the risk covered by the bond to investors on infectious disease pandemics, terrorism, earthquakes, and other perils.

Jin Shah, client director at RMS, said: “RMS developed an indemnity trigger on loss ratios and supported investors’ understanding of the risk, especially on the contribution from the current COVID-19 pandemic.”