AIG turns to Compass Re for US cat coverage

Under-fire insurer, AIG has entered into a $400 million collateralised peak zone reinsurance contract with Bermuda incorporated, Compass Re.

Special purpose insurer, Compass Re will provide AIG with coverage for US hurricane and earthquake losses. In order to fund its potential obligations to the US giant, Compass Re has issued a $400 million cat bond. The bond was listed on the Bermuda Stock Exchange.