Insurance-Linked Securities

We have been a leading firm in structuring and advising on some of the most innovative transactions at the convergence of the insurance and capital markets, including catastrophe bonds, mortality bonds, regulatory reserve financing (XXX, AXXX and annuity), embedded value, sidecars, transformers and credit- and event-linked products and securities, and dedicated investment funds.

New Reinsurer Formations, Sidecars and Dedicated Funds

Mayer Brown has been at the forefront of the development of third-party risk capital arrangements in the reinsurance markets. We are a leading firm in advising on permanent capital vehicles, sidecars and dedicated insurance risk fund transactions.

We represented Montpelier Reinsurance Ltd. in the establishment of a collateralized retrocession program involving the issuance of non-voting preference shares in segregated accounts of a newly established, special purpose insurer, Deep Blue Ltd.

Our partners acted as counsel on a variety of sidecars formed in the wake of Hurricane Katrina, including Flatiron, Bay Point, Starbound, Concord and Emerson facilities.

• We represented Everest Re Group, Ltd. in the establishment of a $370 million collateralized retrocession program involving the issuance of non-voting, preference shares in segregated accounts of a newly-established, special purpose insurer, Mt. Logan Re, Ltd.
• We represented Montpelier Reinsurance Ltd. in the establishment of a collateralized retrocession program involving the issuance of non-voting, preference shares in segregated accounts of a newly-established, special purpose insurer, Deep Blue Ltd.

Our partners acted as lead structurer and counsel in connection with:

• Altair Re, a sidecar sponsored by ACE Tempest Re, and the follow-on sidecar Altair Re II;
• Mt. Logan Re, a sidecar vehicle sponsored by Everest Re with initial target capacity of $250 million;
• Blue Water Re, a sidecar sponsored by Montpelier Re, as well as formation of its master dedicated investment fund Blue Water;
• Alterra’s New Point IV and V facilities; and
• MaRI, a sidecar that raised capacity for ACE

We have represented investor groups in numerous sidecars, including:

• RenaissanceRe’s Upsilon II facility;
• Timicuan, which delivered additional reinsurance capacity to the Florida market;
• Validus’ AlphaCat Re – 2011 facility;
• Swiss Re’s Sector facility; and
• Transatlantic Re’s Pangaea sidecar.

We act as regular counsel to Everest Re, Montpelier Re, PartnerRe and Tokio Millennium in structuring third-party risk capital arrangements.

Catastrophe Bonds and other Insurance Linked Securities

We are a leading firm in advising on insurance linked securities offerings. Our partners have represented sponsors, arrangers, initial purchasers and investors on numerous catastrophe bonds, extreme mortality bonds and other insurance-linked securities over the past decade. We have acted on 30 catastrophe bond offerings in the last two years alone, raising more than $7 billion in risk capital. Many of our recent transactions have broken new ground in the convergence of capital and insurance markets, including:

• The $200 million MetroCat Re Ltd catastrophe bond offering in July 2013 for the benefit of New York’s Metropolitan Transportation Authority (MTA), the largest transportation network in North America. This transaction was the first storm-surge catastrophe bond in history and the first time the MTA has accessed the capital markets to obtain insurance protection from events like Super storm Sandy in 2012. This transaction was named 2014 “Non-Life Transaction of the Year” by Trading Risk magazine and Bond Buyer’s 2013 Deal of the Year award for “Non-Traditional Financing.” Also, the Financial Times recognized Mayer Brown among the “most innovative” 2013 US law firms ranking this transaction as a “Standout,” its highest category.
• The ¥10.125 billion Aozora Re Japanese Typhoon catastrophe bond offering in May 2014 providing collateralized indemnity reinsurance to Sompo Japan Insurance and Nipponkoa Insurance Company. The transaction was structured on an indemnity basis and was the first of its kind to be denominated in yen.
• The $1.5 billion Everglades Re hurricane catastrophe bond offering in April 2014 providing collateralized indemnity reinsurance to Citizens Property Insurance Company, the state-sponsored residual market entity in Florida. This was the largest 144A offering of catastrophe bonds in the history of the ILS market. In 2012, we advised on Everglade Re first offering of catastrophe bonds which received Trading Risk’s 2013 Elemental Transaction of the Year Award