Insurer Travelers has completed a $300 million issue of catastrophe bonds through an existing shelf program, Long Point Re III, according to the deal's underwriters. 

Swiss Re, the lead structurer and joint bookrunner, and GC Securities, a joint bookrunner, issued separate press releases today announcing the completion of the deal.

The transaction consists of a single tranche of notes due May 18, 2016 with a 4.00% coupon; it is rated ‘BB’ by Standard & Poor’s.

Cat bonds are a form of reinsurance. In the event that certain triggers are met, the issuer can skip interest payments or even keep the principal to cover insured losses. In a press release issued today, GC Securities said the trigger on this deal is overall losses of the issuer, Travelers.  

It is the second deal of this type that Travelers has issued from Long Point Re III, a special purpose vehicle in 2012. The latest issue has several new features that allow Travelers to access funds under a wider range of conditions, according to GC Securities. For example, the definition of a hurricane has been expanded. Also, Travelers has the ability to adjust the level of protection it has once a year.

Currently, the notes will cover 54.55% of losses between the attachment point of $1.25 billion and the exhaustion point of $1.80 billion, according to S&P.

In the first quarter there were two cat bond deals for a combined $520 million; while that's well below issuance in the first quarter of 2012, GC Securities has said it expects 2013 cat bond issuance to come within reach, if not exceed, the $7 billion record hit in 2007. 

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