Government of Mexico renews and expands MultiCat cat bond

The renewal and expansion signals a growing market for public sector risk transfer solutions and Swiss Re's continuing commitment to Latin America.

The World Bank and the Mexican Government announced a renewal of Mexico's MultiCat catastrophe ("cat") bond program, which was created in 2009 in a pioneering move to help Mexico transfer catastrophe risk to the capital markets (PDF, 22.81 KB). The multi-year cat bond is scheduled to mature on 4 December 2015.

Swiss Re served as co-lead manager of the transaction, reaffirming the company's leadership in supporting the public sector in managing its catastrophic risk, and building on over 100 years of active participation in the Latin American insurance and reinsurance industry.

MultiCat forms a key component of Mexico's sovereign catastrophic risk transfer strategy, which has been carefully designed and implemented over the last decade. The program combines risk mitigation, risk modeling as well as traditional and parametric insurance to allow the government to financially prepare for disasters and put a price tag on risks the nation faces.

Swiss Re worked closely with the Government of Mexico and the World Bank to renew the MultiCat Mexico cat bond, which covers two natural perils, earthquake and hurricane, utilizing parametric triggers as part of this risk transfer model.

The transaction points to Swiss Re's long-standing commitment to helping emerging markets build resilience through the use of innovative insurance solutions and the public-private partnership model. Swiss Re was the first global reinsurance company to dedicate a team to work with governments on their risk management needs. The success of MultiCat once again demonstrates the growing demand within the public sector for these solutions, as well as the growing acceptance by the reinsurance and insurance industry of these programs.

Find out more

2009 MultiCat Mexico cat bond information

Swiss Re's public-private partnerships and parametric insurance solutions

 

Published 15 October 2012


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