Swiss Re successfully closes its second life catastrophe bond and obtains USD 362 million of mortality risk coverage through the Vita Capital II programme
14 Apr 2005
Swiss Re has successfully transferred USD 362 million of mortality risk to the capital markets. Swiss Re Capital Markets Corporation, acting as sole bookrunner, privately placed the securities with institutional investors.
Swiss Re has entered into a transaction with Vita Capital II Ltd to receive up to USD 362 million of payments in the event of severe population mortality. Swiss Re experienced strong interest in the life catastrophe bond, which was oversubscribed. The details of the issuance are as follows:
The structure of the Vita Capital II risk coverage is based on a combined mortality index, which applies predetermined weights to the annual general population mortality in the United States, United Kingdom, Germany, Japan and Canada. The principal of the Vita Capital II notes begins to be at risk if, during a measurement period of any two consecutive years within the risk coverage period, the combined mortality index exceeds predefined percentages of the expected mortality level (120% for Class B, 115% for Class C, 110% for Class D).
Notes to editors
Swiss Re is one of the world’s leading reinsurers and the world’s largest life and health reinsurer. The company operates through more than 70 offices in over 30 countries. Swiss Re has been in the reinsurance business since its foundation in Zurich, Switzerland, in 1863. Through its three business groups Property & Casualty, Life & Health and Financial Services, Swiss Re offers a wide variety of products to manage capital and risk. Traditional reinsurance products, including a broad range of property and casualty as well as life and health covers and related services, are complemented by insurance-based corporate finance solutions and supplementary services for comprehensive risk management. Swiss Re is rated “AA” by Standard & Poor’s, “Aa2” by Moody’s and “A+” by A.M. Best.
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Certain statements contained herein are forward-looking. These statements provide current expectations of future events based on certain assumptions and include any statement that does not directly relate to a historical fact or current fact. Forward-looking statements typically are identified by words or phrases such as "anticipate," "assume,” "believe," "continue", "estimate", "expect", "foresee", "intend," "may increase" and "may fluctuate" and similar expressions or by future or conditional verbs such as "will," "should," "would" and "could." These forward-looking statements involve known and unknown risks, uncertainties and other factors, which may cause Swiss Re’s actual results, performance, achievements or prospects to be materially different from any future results, performance, achievements or prospects expressed or implied by such statements. Such factors include, among others:
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- the frequency, severity and development of insured claim events;
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