Harneys, dropRWA Plan Tokenized Catastrophe Bonds for 2027 Issuance

Law firm Harneys and asset tokenization platform dropRWA plan to launch tokenized catastrophe bonds in early 2027, targeting a multi-billion-dollar gap in disaster insurance coverage.

The initiative will register the bonds in Bermuda and represent legal ownership on-chain using tokenized certificates. The plan aims to attract capital for high-risk, high-return disaster coverage by potentially lowering the minimum investment threshold, thus widening the pool of eligible investors compared to traditional, large-denomination cat bonds.

The market addresses a significant need, as natural disasters caused an estimated $220 billion in economic losses globally last year, with insurance covering only about half that amount. The traditional catastrophe bond market had reached $65.6 billion by mid-2026 as insurers increasingly transfer disaster risks to capital markets.

Despite the blockchain-based structure, the tokenized instruments will remain subject to existing securities, insurance, and investor-protection regulations. The Asia-Pacific region, with its high exposure to natural disasters, has been highlighted as a key area with persistent coverage gaps that such instruments could help address.