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Hurricane Simon poses risk to Mexico IBRD cat bond as landfall nears
A $175 million IBRD CAR Mexico 2024 (Pacific) parametric catastrophe bond is exposed, as the storm’s pressure has been rising since the latest NHC update.
Hurricane Simon remains a very strong major hurricane in the Pacific and is expected to sustain that intensity as it nears landfall on Mexico’s coastline on Sunday, Artemis reports.
The outlet says the storm’s intensification and changes in its pressure are putting the $175 million IBRD CAR Mexico 2024 (Pacific) parametric catastrophe bond at potential risk.
Artemis also notes that the NHC’s latest update shows Simon weakened after earlier measurements, with winds easing from 130 mph and central pressure of 947 mb on Oct 10 to 125 mph and central pressure estimated at 951 mb on Oct 12.
Artemis adds that analysis interpolating Simon’s pressure along its path suggests the bond’s parametric conditions were not breached during the storm’s passage just along the coast of Jalisco state, and that sources say Simon was not at pressure levels required to activate a payout when it came closest to the trigger boundaries earlier on Sunday.