Hannover Re CAT bond reduces European windstorm exposure

The reinsurer’s strategy to reduce peak exposures means Hurricane Katrina would cost it 40% less today than last year

Hannover Re has resorted to a traditional CAT bond to reduce its exposure to European windstorm risks. The $150mn bond transferred peak natural catastrophe exposure in seven European countries – Belgium, Denmark, France, Germany, Ireland, Netherlands, and UK – to institutional investors in Europe and North America.