Aon has facilitated the issuance of a new $45.5 million private catastrophe bond, named Randolph Re, through its protected cellular company, White Rock Insurance Company PCC Limited.

This bond issuance represents the first time that catastrophe bonds have been structured using the Guernsey Protected Cell Company (PCC) format.

The Series 2024-1 Special Catastrophe Bonds are a renewal of previous deals focused on wildfire reinsurance. Coverage is provided on an indemnity basis to a U.S. property and casualty insurer with significant exposure to California wildfires.

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Carey Olsen’s Guernsey team, led by Partner Christopher Anderson and Senior Partner Arya Hashmi, advised on the bond issue. Anderson highlighted the significance of the bond issue by a Guernsey general insurance company, describing it as a historic moment for the Guernsey insurance industry.

He noted that this demonstrates the advantages of structuring insurance-linked securities transactions in Guernsey and Aon’s ability to expand its operations across different jurisdictions.

Robert Pleasant (pictured above), CEO of Guernsey Finance, commented on the growing importance of these financial instruments in addressing climate risk.

He noted that as climate change continues to worsen, Guernsey’s role as a hub for innovative disaster bond solutions is expanding, pointing to previous initiatives with the Danish Red Cross and the International Federation of Red Cross and Red Crescent Societies.

Elsewhere in the market, Pool Re, the UK’s leading terrorism reinsurer, has awarded an insurance-linked securities advisory contract to Aon Securities Limited and Howden Capital Markets and Advisory. The aim is to enhance protection for UK taxpayers.

Pool Re has previously used catastrophe bonds to secure reinsurance protection, successfully securing £175 million of ILS capacity through UK-based special purpose vehicle Baltic PCC Ltd. through catastrophe bond issues in 2019 and 2022.

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