Beazley, the London headquartered specialty insurance and reinsurance company, is back in the 144A catastrophe bond market to sponsor a new cyber cat bond deal, seeking $200 million or more in excess-of-loss protection from a PoleStar Re Ltd. (Series 2026-1) issuance.
Beazley first sponsored a 144A cyber cat bond in December 2023, with the $140 million PoleStar Re 2024-1 deal, following it up with a $160 million PoleStar Re Ltd. (Series 2024-2) issuance in May 2024 and then most recently its largest yet a $210 million PoleStar Re Ltd. (Series 2024-3) that it sponsored in September 2024.
The three PoleStar Re cyber cat bonds filled out Beazley’s cyber reinsurance tower from an attachment point of $500 million up to exhaustion at $800 million with the 2024-1 and 2024-2 issues, then the 2024-3 notes covered a share of the reinsurance tower from attachment at $800 million up to $1.2 billion.
Now, with this PoleStar Re 2026-1 cyber catastrophe bond Beazley is looking to build the capital markets participation in its cyber reinsurance tower higher up, starting from $1 billion with this new deal. It’s important to note that we do not know at this time whether any of the Series 2024 notes have been reset to different attachments at this time.
View details of every cyber catastrophe bond by filtering our Deal Directory.
PoleStar Re Ltd., the Bermuda based special purpose insurer (SPI), will look to issue three tranches of Series 2026-1 cyber cat bond notes that will be sold to investors and the proceeds used to collateralize the underlying reinsurance agreements with Beazley.
The cyber reinsurance coverage will be on an indemnity trigger and per-occurrence basis, like the previous PoleStar Re cat bonds.
Similarly again the PoleStar Re 2026-1 notes are designed to provide Beazley with a source of broad cyber reinsurance coverage from the capital markets, protecting it against major cyber loss events that impact its underwriting entities, including its range of syndicates at Lloyd’s and its US insurance underwriting entities.
We’re told the new PoleStar Re 2026-1 cyber cat bond will provide Beazley with coverage over three years through to the end of 2028, meaning the company continues to schedule all its cyber cat bond renewals in an aligned and staggered manner for the months of January over the next few years.
Beazley’s first 144A cyber cat bond, PoleStar Re 2024-1, is scheduled for maturity in January 2026, so being larger this 2026-1 deal should expand on the coverage those $140 million of 2024-1 notes provided.
So, across the three tranches of Series 2026-1 notes that PoleStar Re is offering to investors, the initial target is to secure $200 million of cyber reinsurance.
A $75 million Class A tranche of notes would attach their coverage at $1 billion of losses and cover a share up to $1.4 billion we understand, giving them an initial attachment probability of 0.98%, an initial expected loss of 0.82% and they are being offered with price guidance in a range from 7% to 8%, we are told.
A $75 million Class B tranche of notes would attach their coverage at $600 million of losses and cover a share up to $1 billion we understand, giving them an initial attachment probability of 1.81%, an initial expected loss of 1.31% and they are being offered with price guidance in a range from 8.75% to 9.75%.
The final $50 million Class C tranche of notes would attach their coverage at $500 million of losses and cover a share up to $600 million, giving them an initial attachment probability of 2.33%, an initial expected loss of 2.05% and they are being offered with price guidance in a range from 10.75% to 11.75%, sources said.
So the notes from this PoleStar Re 2026-1 issuance will sit on top of each other to build out more protection in Beazley’s cyber reinsurance tower and take the protection from the capital markets higher up as well, which is a natural progression as its own cyber insurance portfolio continues to grow.
With a number of cyber catastrophe bonds set to mature through the first few months of 2026 and some of those not expected to be renewed at this stage, it is encouraging to see Beazley continuing to seek to expand its cyber catastrophe bond program, setting an example for other large underwriters of cyber risk.
You can read all about this PoleStar Re Ltd. (Series 2026-1) catastrophe bond transaction in our Deal Directory, where you can analyse details of almost every cat bond ever issued and filter the list by peril to show only cyber cat bonds.
