PALO ALTO, Calif.--(BUSINESS WIRE)--Spinnaker Insurance Company, a wholly owned subsidiary of Hippo Holdings Inc. (NYSE: HIPO), today announced the successful sponsorship of Mountain Re Ltd. Series 2023-1 catastrophe bond. The $110 million cat bond is a 10% upsize from the initial $100 million transaction target.
As part of the transaction, Spinnaker is entering into a reinsurance contract with Mountain Re that offers protection against a variety of perils, including named storms, fire following an earthquake, severe thunderstorms, and winter storms, and provides Spinnaker with diversification of risk transfer capacity and access to capital markets.
“The successful sponsorship of our debut catastrophe bond demonstrates our maturation as a company. It is the direct result of our geographic diversification efforts and will serve as an integral part of our reinsurance program,” said Hippo President and CEO Rick McCathron. “Mountain Re is a multi-year, capital-markets-backed source of reinsurance that provides reinsurance coverage against catastrophic events for Hippo Insurance Service’s homeowners products underwritten by Spinnaker.”
The Class A Notes issued by Mountain Re Ltd. came at a spread of 6.75%, with an initial base expected loss of 0.86% and an indemnity trigger over a three-year term with the Class A Notes scheduled to mature on June 5th, 2026.
The cat bond was successfully closed on May 31, 2023. GC Securities, a division of MMC Securities LLC, was the sole structuring agent and bookrunner.
“Current market conditions require creative risk transfer structures like the one provided by Mountain Re,” said Shiv Kumar, President of GC Securities. “We’re very pleased to support Spinnaker as it delivers innovative insurance solutions and access to the reinsurance market to MGA, program administration and insurtech companies.”
Mountain Re is not a subsidiary or affiliate of Hippo.
About Hippo
Hippo is protecting the joy of homeownership, helping to safeguard customers’ most important financial asset by harnessing the power of real-time data, smart home technology, and a growing suite of home services to deliver proactive home protection.
Hippo Holdings Inc. operating subsidiaries include Hippo Insurance Services, Hippo Home Care, First Connect Insurance Services, Spinnaker Insurance Company, Spinnaker Specialty Insurance Company, and Mainsail Insurance Company. Hippo Insurance Services is a licensed property casualty insurance agent with products underwritten by various affiliated and unaffiliated insurance companies. For more information, including licensing details, visit http://www.hippo.com.
