AXA Cessions, the reinsurance entity of financial protection and wealth management group AXA Group, completed a $442 million securitization of catastrophic mortality risk last week.
The 144A transaction, which closed on Nov. 9, is innovative in several ways. AXA is using a catastrophe bond structure to transfer extreme mortality risk from three countries - France, Japan and the U.S. - over a period of four years. Osiris is the first catastrophic mortality program structured for a primary insurance company. Also, the deal will sell notes denominated in euros and U.S. dollars, and is based on a multi-country mortality index. Mortality in France accounts for 60% of the risk in the deal, according to Swiss Re, a global reinsurance company that arranged the transaction. Ixis CIB and Lehman Brothers also participated on the deal, although their exact roles were unclear.