#USA #Sarasota #Centauri Insurance #Lilypad Insurance #Koi Re

Centauri and Lilypad’s Innovative Catastrophe Bond

In a significant move within the insurance industry, Centauri Insurance and Lilypad Insurance successfully issued the Koi Re, a $30 million catastrophe bond designed to bolster their financial resilience against named storms in the United States. This issuance marks a strategic advancement in the companies’ use of capital markets to enhance their risk management capabilities.

The Koi Re bond is set to provide coverage for one year, allowing both Centauri and Lilypad to shift part of their storm-related risk to the capital markets. Structured as a privately-placed, 4(a)(2) issuance, this initiative diversifies their options for risk transfer and secures extra resources to support their policyholders during extreme weather events.

Understanding the Koi Re Bond Structure

The Koi Re series consists of $30 million in Class A notes, structured and placed by Lockton Re Capital Markets. These notes offer indemnity reinsurance coverage on a per occurrence basis for Lilypad’s properties located in vulnerable regions such as Hawaii, Texas, Louisiana, Mississippi, Alabama, Florida, and South Carolina, extending through May 31, 2026.

Issued through a Segregated Account of Sailfish Re Ltd., a Bermuda-based special purpose insurer, Koi Re enables insured parties to quickly tap into broader capital pools via an established, independently managed platform. This innovative approach reflects a growing trend among insurers to access alternative capital sources as they navigate increasing climate-related risks.

Quotes from Industry Leaders

Ricardo Espino, CEO of Lilypad Insurance, expressed enthusiasm about the initiative, stating, “The successful placement of Koi Re underscores our commitment to innovative risk management solutions. By accessing the capital markets via our inaugural catastrophe bond, we have introduced a new capital source to better protect our policyholders and ensure financial resilience against catastrophic events as we continue to grow our operations.”

Zach Breslin, Head of Lockton Re Capital Markets, added, “We are proud to support Centauri and Lilypad in this important transaction. Koi Re exemplifies how insurers can effectively access the capital markets to manage exposure to natural disasters. It is a prime example of Sailfish Re's utility in delivering tailored solutions to address client needs.”

The Evolution of Insurance and Capital Markets

This development signifies a continuing evolution in the way insurance companies access alternative capital to strengthen their reinsurance frameworks. As climate-related risks escalate, firms like Centauri and Lilypad are not only seeking innovative ways to protect their bottom line but also to assure their clients of continued support through unforeseen circumstances.

About Centauri Insurance

Founded in 2006 and headquartered in Sarasota, Florida, Centauri Specialty Insurance Company is a property and casualty provider licensed to operate across several states, including Alabama, Florida, Hawaii, Louisiana, Mississippi, South Carolina, and Texas. Renowned for its catastrophe coverage and customer-focused strategies, Centauri aims to deliver personalized, protective insurance solutions.

About Lilypad Insurance

Lilypad National Insurance Company specializes in offering insurance solutions tailored for homeowners and property owners in coastal areas. By utilizing advanced technology and leveraging extensive industry knowledge, Lilypad aims to meet the unique challenges faced by its clients, providing comprehensive coverage options.

About Lockton Re

Lockton Re's reinsurance division helps organizations understand and mitigate their risks. With a global presence and a team dedicated to delivering innovative solutions, Lockton Re continues to play a vital role in revolutionizing the reinsurance landscape by leveraging new technologies and client-focused approaches.

In conclusion, the Koi Re catastrophe bond serves as a promising model for how insurance companies can turn to capital markets for the resources needed to manage their risks more effectively, especially in an era where climate uncertainties loom large.