IncubEx, the financial product and service development firm that counts its founder and Chairman as insurance and reinsurance entrepreneur, former Brit co-founder and now Conduit Re Chairman Neil Eckert, has acquired an insurtech as it targets environmental, sustainable and climate risk solutions.
IncubEx develops financial products in global environmental, climate risk and related commodity markets.
The company has previously targeted catastrophe risk trading and Eckert had previously been behind the catastrophe risk derivatives trading ideas of the Insurance Futures Exchange (IFEX), a venture that sought to make catastrophe risk into a tradable asset and was seen to be a little ahead of its time.
Artemis has previously been told that IncubEx has long been exploring the launch of some kind of catastrophe risk trading product, with sources saying the company has targeted the types of products that insurance, reinsurance and insurance-linked securities (ILS) funds may want to trade.
But this new acquisition puts IncubEx into an interesting position, of securing a technology platform that could be a key piece of market infrastructure for any future climate or catastrophe risk related financial products it wants to sell.
Insurwave is an insurtech platform designed to connect insurance buyers, brokers and insurers, with a specific goal of facilitating the placement and servicing of specialty insurance.
Insurwave was founded by Shackleton Holdings Limited, a wholly owned EY entity.
By acquiring Insurwave, IncubEx wants to deliver innovative environmental and sustainability products and technology solutions to the corporate risk and insurance markets, the company said this morning.
Through this acquisition, Shackleton has now become a minority shareholder in IncubEx, helping to support Insurwave through its next stage of development.
Insurwave has focused predominantly on the global marine insurance markets so far and demonstrated the value of its technology.
Now, Insurwave aims to expand across other major geographies and lines of business, including property, liability and energy as part of IncubEx.
IncubEx is aligned with Insurwave as it has always had a focus on products and services that promote price discovery and transparency, as well as access to markets or data, and transactional efficiencies in environmental markets globally.
Insurwave now provides IncubEx with a platform to achieve similar in the insurance and reinsurance sector, having identified areas where information and data can be improved, and transformational efficiencies be generated for its customers and the market, using its technology, the company said.
It’s an interesting acquisition and could see IncubEx going all-in on delivering transparent, tradable insurance risk related products in the climate, property and perhaps even catastrophe space, in time, aligning with the firms and its founder Eckert’s long-held and much-discussed ambitions.
Connecting risks with capital using technology in a way that promotes market transparency and efficiency, aligns with the goals of Eckert’s previous ventures into trading insurance risk, such as IFEX.
Eckert previously also founded Climate Exchange plc, through which the IFEX catastrophe futures were launched. With the world increasingly focused on climate-related financial products and putting a price on climate risk, a functioning insurance marketplace powered by technology could weave very nicely into Eckert’s ambitions.
It will be interesting to see how Insurwave evolves and also how that could tie into Conduit’s future as well, given it could potentially develop into a clear route to access risk for the reinsurance company.
Neil Eckert, Chairman of IncubEx, commented on the acquisition of Insurwave, “Our view is that insurance and climate risk are becoming inextricably linked. The sector will continue to see expanding opportunities as a result of climate change with increasingly complex supply chain risks in the corporate and captive markets. Our clients will need solutions to manage their transition to net zero across insurance and financial markets and it is critical that we provide the technology to focus on connecting them with brokers and the markets.”
Rodney Bonnard, Director of Shackleton and Partner at Ernst & Young LLP, added, “We are delighted to have invested in and supported Insurwave on this journey, enabling its transition to a standalone business. Given the strategic alignment, it’s the perfect time for Insurwave to develop further as part of IncubEx and we extend best wishes for future success.”
Michael MacGregor, CEO of IncubEx, said, “IncubEx has historically focused on bringing innovative products and solutions to the environmental markets. With the acquisition of Insurwave, we add proven technology that addresses a customer base that is increasingly in need of new products and services that digitize information, improve data access and streamline transaction processes. We are eager to unlock the potential of the Insurwave platform alongside IncubEx’s core focus on global environmental and climate risk market opportunities.”
David Power, CEO of Insurwave, also commented, “Large scale insurance buyers are demanding technology that provides a simple and transparent solution for understanding their exposures and connecting with their insurance markets. Clients require platforms that openly integrate with internal systems and external data. We are excited to see a genuine transformation for insurance buyers, brokers and insurers by embracing the Insurwave platform that connects to their exposures, contracts and markets today.”
Shaun Crawford, Chairman of Insurwave stated “This is a critical time for innovators and major brands to combine and deliver solutions for industries. I’m very proud of the Insurwave story over the past few years and excited by the market opportunity now being opened up by IncubEx with its ESG credentials. The combination of IncubEx and Insurwave will focus on the specialty and corporate insurance market which has so far been slow in adopting technology.”