RKH & Descartes in parametric wind trade for European asset owner

RKH Reinsurance Brokers, a division of the Hyperion Insurance Group and parametric risk transfer and technology focused managing general agency (MGA) Descartes Underwriting have completed a wind risk trade for a European asset owner, using the AkinovA platform.

The trade saw a European owner of outdoor advertising assets looking for a year’s supplemental insurance coverage against weather conditions that threaten potential damage to its billboards it seems.

The transaction was entered into using the AkinovA technology platform and appears bilateral in nature, from the information provided.

It’s the third transaction to have used the platform to-date, the other two having been cyber risk related and parametric in nature, the first focused on power generation asset cover and the second on cloud infrastructure outage cover.

The participants in the latest deal said this morning that the European asset owner in the advertising industry wanted to protect its in Northern Europe and so purchased a parametric risk transfer solution that provides payouts if gust wind-speeds are recorded above pre-defined levels at specific weather stations located close to a the precise locations of a number of billboards.

The asset owner purchased the twelve month parametric wind instrument as a hedge against wind-speeds rising above a pre-defined trigger level, at which damage or impacts to its business could have been incurred.

It’s not clear what entity is acting as a calculation or settlement agent on the trade. A trusted third-party is typically required for parametric insurance or reinsurance transactions such as this.

Nick Griffiths, Executive Director of RKH Reinsurance Brokers, commented on the transaction, “RKH Reinsurance Brokers is delighted to have transacted this complex risk on the AkinovA Marketplace. Providing innovative parametric structures and triggers for clients to address protection gap concerns is becoming increasingly important, especially when there is so much business uncertainty on a global level.”

Edern Le Roux, Head of ILS and Cat Modelling for Descartes Underwriting, added, “In today’s digital age, clients call for more straightforward products with clarity on risk transfer and payments. As a tech enabled Insurtech and MGA, Descartes Underwriting is doing just that offering parametric and data centric products.”

Henri Winand, AkinovA CEO, commented on the new transaction, “This weather-related insurance trade underlines AkinovA’s reach across different lines of business beyond cyber risk transfer. In fact, we are now involved in a number of different trades across a variety of risk classes. We were particularly pleased to work with Descartes Underwriting to promote clear and transparent parametric products which are much needed to underpin scalable climate resilience. We designed AkinovA to be digital first but with a clear commitment to the whole risks transfer ecosystem where brokers are true partners in this much needed market transformation. With RKH and other more recent signatories, AkinovA has become a multi-broker, neutral venue where innovators such as MGAs and others can bring new products to their clients. With the risk transfer value chain being digitised at ever increasing speed, AkinovA is playing an important part in its transformation.”