The U.S. Federal Emergency Management Agency (FEMA) has obtained reinsurance coverage through insurance-linked securities (ILS) reinsurance for the seventh time by entering a three-year reinsurance agreement, securing $575 million of coverage for the National Flood Insurance Program (NFIP).
FEMA entered into the agreements with its transformer reinsurer, Hannover Re (Ireland) Designated Activity Company, which transferred $575 million of the program’s financial flood risk to qualified capital market investors through a special purpose insurer, FloodSmart Re Ltd, for sponsoring catastrophe bonds.
