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As part of its policy of diversifying its capital protection tools, on 1 November 2012 SCOR successfully placed a new catastrophe bond (“cat bond”), Atlas Reinsurance VII Limited, which will provide the Group with twofold protection of USD 60 million (“Class A Notes”) against US hurricanes and earthquakes, and EUR 130 million (“Class B Notes”) against European windstorms, for a risk period extending from 1 January 2013 to 31 December 2015.
Atlas Reinsurance VII Limited is an Irish reinsurance vehicle. Aon Benfield Securities Inc., Natixis and BNP Paribas managed the transaction and the book on the deal. Standard & Poor's rates Atlas VII Class A Notes at BB-, and Atlas VII Class B Notes at BB.
The loss payments covered by the Class A Notes are based on market share factors applied to the market insured loss, as reported by PCS for the US on an annual aggregate basis. Class B Note losses are covered on per-occurrence basis, using the PERILS index.
The protection of its capital constitutes a strategic axis for the Group. SCOR regularly uses solutions proposed by the capital markets, with thirteen transactions completed to date:
- Atlas Reinsurance I, II, III and IV, Atlas V and Atlas VI Series 2009-1, Series 2010-1 and Series 2011-1&2; Atlas Reinsurance VII;
- the Helix cat bond issued by Converium, which was integrated into the SCOR group in 2007;
- a contingent capital programme;
- two mortality swaps providing additional protection against major pandemics, natural catastrophes and terrorist attacks.
