Mangrove Launches Catastrophe Bond to Enhance Risk Management in Florida

Mangrove Property Insurance Company has launched its first catastrophe bond, Buttonwood Re Ltd. 2026-1, marking its entry into the insurance-linked securities (ILS) market with $111 million in fully collateralized reinsurance coverage. This strategic move aims to enhance Mangrove's capacity to manage Florida named storm risks by securing multi-year protection in the capital markets. Gallagher Securities served as the structuring agent and bookrunner, with Willkie Farr & Gallagher LLP providing legal counsel, underscoring the regulatory compliance required in such transactions.

The Buttonwood Re 2026-1 bond provides Mangrove with reinsurance support on both per-occurrence and annual aggregate bases for potential storm losses in Florida. Spanning three years, the coverage comprises four note tranches, encompassing three tranches triggered by specific occurrences and one by annual aggregates. This aligns with Mangrove's underwriting strategy as they continue their operational expansion, particularly in assuming policies from Citizens Property Insurance Corporation.

Stephen Weinstein, CEO and founder of Mangrove, highlighted the bond's role in their strategy to redefine risk transfer in the Florida market and build robust relationships with reinsurers and investors in the ILS sector. “We secured protection from over 20 investors, introducing new capital for Mangrove,” Weinstein noted, signaling a commitment to further engagements in the catastrophe bond market. Supporting the transaction, Appleby Bermuda, Moody’s Risk Management Solutions, and Artex Capital Solutions played integral roles as legal, modeling, and insurance management advisors, respectively. The notes from Buttonwood Re 2026-1 are listed on the Bermuda Stock Exchange, enhancing their market presence.