Generali confirms windstorm Bernd won’t trigger Lion III Re cat bond

Generali confirms windstorm Bernd won’t trigger Lion III Re cat bond

Italian and worldwide insurance coverage giant Assicurazioni Generali S.p.A. has verified to financiers in its EUR 200 million Lion III Re DAC disaster bond that European windstorm Bernd and associated floods in July 2021 are not a covered occasion for noteholders to be concerned about, this publication has learned.The Lion III Re catastrophe bond, which was provided in June 2021, was called the worlds first green catastrophe bond offer due to the fact that of a range of functions of the transaction.
The green cat bond functions were said to be: that the Lion III Re cat bond will release up an equivalent quantity of capital from Generalis own balance-sheet to be used for jobs as defined in the green ILS framework; that the security will be invested particularly into green bonds provided by the EBRD; which related to reporting on the projects Generali will designate balance-sheet capital to and the EBRDs green bond reporting.
Maybe more significantly for some financiers, the Lion III Re feline bond offers Assicurazioni Generali S.p.A. with EUR 200 million of reinsurance security to cover particular losses from Italian earthquakes and european windstorms, on an indemnity trigger and per-occurrence basis.
The European windstorm covered location includes Germany, along with other countries that were especially severely affected by windstorm Bernd and the associated severe floods that followed.
In spite of this and the reality Generali had actually stated back in August that its reinsurance program would cap its losses from Bernd and the floods at EUR 100 million, its now clear the Lion III Re cat bond will not be affected, Artemis has discovered.
Generali validated in a communication to its cat bond investors seen by this publication, that windstorm Bernd is not thought about a European windstorm event for the purpose of the Lion III Re catastrophe bond notes.
For a European windstorm event to impact the Lion III Re feline bond notes we believe it would require to cause Generali a ground up loss of over EUR 600 million, while a flood loss would require to cost the insurer over a billion Euros.
Generali did not have much exposure in countries like Belgium, which were severely impacted by Bernd and the floods, so its possible the loss just didnt get close to the accessory for the feline bond notes.
You can read everything about the Lion III Re DAC green catastrophe bond and every other feline bond ever released in the Artemis Deal Directory.

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