PG&E Corp. has completed its $200 million Cal Phoenix Re Ltd. series 2018-1 catastrophe bond, Artemis reported.
The instrument provides the company with a three-year source of insurance protection against property damages caused by wildfires in California. The bond does not protect damages to its own infrastructure; it is for third-party liability.
The coupon was priced at 7.5%, higher than the initial guidance of 6% to 6.5%. The cat bond did not, however, upsize as previously expected, the insurance-linked securities blog noted.
The underlying risk is being ceded via Energy Insurance Mutual Ltd. as the insured party, which is in turn provided with reinsurance by Tokio Millennium Re AG.