A U.K. reinsurer has sold the first terror catastrophe bond, giving investors the chance to lock in high yields in return for taking on terrorism risks.

The 75 million-pound ($99 million) three-year bond will pay 5.9 percent interest, state-backed Pool Re said in a statement. The notes were issued through a special-purpose company called Baltic PCC Ltd.

Modeled on Catastrophe bonds, the new notes will suffer losses if insurers have to pay out on terror attacks including chemical, biological or cyber. Catastrophe bonds, which pay out after natural disasters such as hurricanes or earthquakes, have found a market by offering investors a high-yield asset uncorrelated to economic or financial-market risks.

[Related:Innovating Terror Risk Transfer: A Conversation With Pool Re’s CEO]

The Baltic PCC deal complements “traditional reinsurers to spread terrorism risk even more broadly,” Pool Re Chief Executive Officer Julian Enoizi said in the statement. “In addition, it further protects HM Treasury, and helps us towards our ultimate goal of returning terrorism risk to private markets.”

Pool Re was set up in 1993 after the Irish Republican Army’s mainland U.K. bombing campaign prompted reinsurers to stop covering terrorism-related damage.

Guy Carpenter’s GC Securities placed the three-year bond. In a release outlining its participation in the transaction, GC noted “the cat bond provides multi-year, indemnity retrocession protection for terrorism risk in the UK and breaks new ground on multiple fronts.”

GC added that “the innovative transaction is the first to transfer standalone terrorism risk to the ILS market, the first ever issuance in sterling and the first issuance to use Computational Fluid Dynamic modeling for the risk analysis.”

As well, GC noted that Baltic PCC is “the first protected cell company to issue a cat bond under the UK Risk Transformation Regulations 2017.”

*Carrier Management added additional material from GC Securities to this story.