The insurance protection gap

The protection gap – underinsurance in emerging and developing economies and the gap between economic and insurance losses – the opportunity that is on every reinsurance CEO’s lips and which presents the largest opportunity to put excess risk transfer capital to use, requiring both traditional and capital markets support.

In a market that is faced with abundant and ongoing pressure, from excess capital, new entrants, the capital markets, reductions in buying, consolidation of reinsurer panels and difficult global financial market conditions, the reinsurance industry is focusing on the next big opportunity.

This opportunity provides both reinsurers and ILS fund managers with an opportunity to assist in building the world’s resilience to disaster risks, while providing rapidly paying post-event risk finance, at the same time as growing the world’s catastrophe risk markets.

It’s win-win for both sides, those in need of resilience and disaster risk financing and the re/insurance and ILS market which is keen to expand into new regions, perils and opportunities. Narrowing the protection gap is expected to be a key focus for years to come.

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Global Parametrics & Hannover Re complete index-based water risk transfers

Global Parametrics has structured and backed with capital from its Natural Disaster Fund (NDF) two index triggered water risk transfer arrangements covering smallholder farmers in India and Tanzania, with reinsurance giant Hannover Re providing some of the risk capital to support the deals. The two parametric risk transfer arrangements have been read the full article →

Global Parametrics & Hannover Re back another Arbol-powered weather risk pilot

Global Parametrics and reinsurance giant Hannover Re are together supporting a weather risk insurance pilot scheme that is powered by Arbol’s technology and smart contract driven marketplace for weather risk transfer. The pair are supporting the AGRIBEE Crop Insurance Pilot with capacity to enable the provision of extreme weather protection cover read the full article →

Catastrophe bonds a win-win for governments & investors, says APEC

The Asia-Pacific Economic Cooperation (APEC) continues to see the development of a regional catastrophe bond market as positive, highlighting at a recent workshop that cat bonds are a win-win relationship for governments and investors. The workshop last week was convened by The World Bank Treasury alongside the APEC Business Advisory Council read the full article →

Nat cat protection gap widened in 2019 including in North America

Despite the fact insurance and reinsurance markets become increasingly sophisticated in their use of technology to reach customers and provide enhanced coverage, in North America, perhaps the most advanced economy in insured terms, the natural catastrophe protection gap actually widened by over 7% in 2019. It should perhaps be considered an read the full article →

Climate change a systemic risk without global action: Munich Re’s Jeworrek

Global action to combat climate change is essential to avoid the exposure becoming systemic in nature, which might cause it to become less insurable, according to Munich Re's CEO of Reinsurance, Torsten Jeworrek. Speaking during a media briefing held as a virtual replacement for the Monte Carlo Rendez-Vous event, which was read the full article →

AXA Climate & SatSure partner for global parametric risk transfer solutions

AXA Climate, the parametric specialist risk transfer unit of global insurance and reinsurance company AXA, has partnered with SatSure AG, a provider of decision intelligence solutions using satellite data, to roll-out parametric risk transfer solutions around the globe. AXA Climate will underwrite the parametric risks, presumably on an insurance and reinsurance read the full article →

Global Parametrics & Hannover Re renew Yucatan coral reef cover

Global Parametrics, the parametric and index-based disaster risk transfer company, has partnered with global reinsurance firm Hannover Re to renew an innovative Yucatan, Mexico coral reef parametric insurance cover. The transaction renews the coverage for the Mexican Reef Protection Program, an initiative that leverages parametric risk transfer and reinsurance capacity, in read the full article →

Undeniable climate change impact starting to get priced in: Hilti, Credit Suisse

Following the increased severity and frequency of wildfires, droughts and floods in recent times, the undeniable impact of climate change on water-related catastrophes is starting to get priced in and risk premiums are adjusting, according to Niklaus Hilti, Head of Credit Suisse’s Insurance-Linked Strategies division. In a recent interview, experienced insurance-linked read the full article →

Global Parametrics structures DFID-backed South Atlantic windstorm derivative

Global Parametrics, the parametric and index-based disaster risk transfer company, has structured a windstorm derivative transaction for a business on remote South Atlantic island Tristan da Cunha, with the deal backed by capacity from the UK Government’s Department for International Development, through the Natural Disaster Fund (NDF). The windstorm derivative features read the full article →

Global Parametrics builds out team with weather scientist & software hires

Global Parametrics, the parametric and index-based disaster risk transfer company, has added two hires as it continues to build out its team to meet growing demands for index-based risk transfer and insurance products. Global Parametrics aims to consolidate on its position as a provider of climate and natural disaster risk protection read the full article →