Amlin said the transaction provides the group with “fully collateralised protection over a three year period from 1 January 2012 against cumulative modelled insurance and reinsurance claims of in excess of US$630 million in a single year from US Hurricanes and US Earthquakes (defined as gross insurance and gross reinsurance claims) and/or European Windstorms (defined as gross reinsurance and net insurance claims), where such modelled claims per event are in excess of US$75 million”.

Charles Philipps, chief executive of Amlin PLC, said: “The protection afforded under this bond will complement our traditional reinsurance programme and protect the Group from frequency of major catastrophe losses allowing us to consolidate our position in improving market conditions.”

This cover is in addition to the protection that Amlin purchases through the traditional reinsurance markets. The cover provided by the bond is based on market share factors applied to market industry losses as reported by PCS for the US and PERILS for Europe.

As part of the transaction Amlin AG has entered into a risk transfer contract with Tramline Re Limited which will issue to investors $150 million of three year principal-at-risk variable rate notes...

The transaction was arranged by Aon Benfield Securities with risk modelling provided by AIR Worldwide.