Swiss Reinsurance Company has transferred a third batch of mortality risk to investors.

Swiss Re, Zurich, says it has completed efforts to securitize $705 million in mortality risk through a special purpose vehicle, Vita Capital III Ltd.

Vita promises to make payments to Swiss Re if the overall death rate in the United States, United Kingdom, Germany, Japan and Canada turns out to be substantially higher than the base-year mortality level over the following 2 years.

Vita then sells “principal-at-risk” notes with returns tied to a mortality index to institutional investors.

If the death rates incorporated in the index remain within expected levels, the noteholders get the maximum level of return.

If the death rates and the mortality index level are high, then the noteholders will get a lower level of return.

Swiss Re has transferred $762 million in mortality risk through 2 previous Vita Capital securitization deals.

Interest in the third mortality catastrophe bond program has been strong, Swiss Re says.

Swiss Re reports that it has authorization to offer up to $2 billion in securities through the Vita Capital III program.