Palomar Specialty Insurance Co., based in La Jolla, said it completed a $17.5 million surplus note issuance in a private placement to RenaissanceRe Ventures Ltd., and to funds under management by a premier asset manager.

Proceeds from the transaction will be used for general working capital purposes and will increase its policyholder surplus, the company said.

Palomar Specialty Insurance is a recently established catastrophe insurer that has focused on writing residential earthquake insurance, commercial earthquake insurance and difference in conditions insurance in such states as California, Oregon, and Washington.

The company now is an admitted carrier in 16 states.

Willis Capital Markets & Advisory acted as exclusive placement agent to Palomar Specialty in the transaction, while Michelman & Robinson LLP and Ropes & Gray LLP aced as legal counsel.