Pandemic Risk Insurance Act (PRIA)

As part of the latest Artemis Live webcast, industry experts argued that utilizing technology will be critical in enabling the reinsurance and alternative capital markets, or ILS sector, to help hedge pandemic risk using parametric solutions.

Vesttoo and Artemis have partnered to host a live webcast on May 25th 2021 where we will discuss and explain opportunities to hedge the next pandemic, using parametric risk transfer, facilitated through the use of data and technology, as well as capacity from the capital markets.

A working group of the Indian insurance and reinsurance regulator IRDAI has proposed the creation of a parametric Indian Pandemic Risk Pool, which could use pandemic bonds as part of its capacity.

Europe’s insurance and reinsurance sector watchdog, the European Insurance and Occupational Pensions Authority (EIOPA), has highlighted the potential role of the capital markets and insurance-linked securities (ILS) in risk transfer and reinsurance facilities to support pandemic insurance provision.

Global insurance and reinsurance company Chubb has published the details of a proposal for an enormous $1.25 trillion public private risk sharing facility to protect both small and large U.S. businesses against future pandemic risks, with part of the coverage proposed to be structured on a parametric trigger basis.

TotusRe is proposing the use of a cell insurance structure, alongside public and private market participation and the use of retrocessional reinsurance, as a solution to cover multiple risks of national importance, including pandemics.

H.R. 7011, or the Pandemic Risk Insurance Act of 2020, has been introduced by politicians and industry leaders including insurance and reinsurance market representatives and proposes the creation of a Pandemic Risk Reinsurance Program to compensate for business interruption caused by future pandemics.

U.S. insurance and reinsurance industry associations have launched a proposal for a industry-backed pandemic risk backstop, called the Business Continuity Protection Program (BCPP) as an alternative to the legislative proposal for a Pandemic Risk Insurance Act (PRIA) reinsurance backstop.

Draft legislation to form a U.S. Federal government backed reinsurance program for pandemic insurance claims is under discussion in the halls of power, with a bill perhaps ready to be submitted to the House before the end of this month.