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.
Climate change adaptation projects and the need for them are rising up the agenda, as a recent surge in damages from severe weather and climate related catastrophe events concentrates the mind on the importance of investing in this area.Public authorities are showing renewed and increasing interest in climate adaptation, while read the full article →
Global insurance and reinsurance group AXA has launched a new phase in its climate strategy and has announced a new parametric risk transfer service called FastCat as part of its commitment initiatives.AXA said it wants to accelerate its contribution to the transition as an investor, insurer and cooperation enabler, seeing read the full article →
China is set to significantly expand the roll-out of an agricultural disaster insurance scheme that has been in pilot mode since 2017, as it has found the results positive in helping small and mid-sized farmers protect their incomes and recover more rapidly from weather and natural catastrophes.The Chinese government first read the full article →
Non-life insurance pricing is expected to continue to strengthen, as rising loss costs in both property catastrophe and U.S. casualty lines drive a need for increased profitability, according to Swiss Re.The reinsurance giant said today that the non-life insurance and reinsurance environment is improving, with profitability on the rise.But there read the full article →
At a recent meeting of the Asia-Pacific Economic Cooperation (APEC) finance ministers the group reaffirmed their commitment to exploring capital market backed disaster risk transfer tools, as well as other forms of insurance or reinsurance.Representatives from the 21 member economies of the Asia-Pacific Economic Cooperation (APEC) meet regularly to discuss read the full article →
A blockchain based parametric weather insurance product has made its first payouts, after severe weather impacted smallholder farmers covered by the product in Sri Lanka.The parametric insurance was launched in a pilot phase a year ago, as Oxfam in Sri Lanka teamed up with insurance and reinsurance broker Aon and read the full article →
The Insurance Development Forum (IDF) considers insurance-linked securities (ILS) to be an “important part” of the work it aims to do, according to Secretary General Ekhosuehi Iyahen.Speaking at a recent lecture in the Old Library at Lloyd’s of London, Iyahen said it was in the interest of the IDF to read the full article →
Having already developed the first parametric insurance policy to insure and enhance the resilience of a coral reef section of the Mesoamerican Reef in Mexico, The Nature Conservancy (TNC) is now looking to expand the product's reach into Florida and Hawaii.The Nature Conservancy (TNC) had partnered with global reinsurance giant read the full article →
Mark Carney, the Governor of the Bank of England, discussed the role of insurance and reinsurance technology as an essential financial took to smooth the world's transition to a 1.5 degree world and highlighted the role of insurance-linked securities (ILS) within that.Speaking on Sunday in New York, on the sidelines read the full article →
A newly launched Coalition for Climate Resilient Investment is set to bring together significant investment and risk industry expertise, with goals including to properly price climate risk, align investment flows with resilience initiatives and to introduce resilience bonds.The Coalition for Climate Resilient Investment was officially launched yesterday at the United read the full article →