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.
The innovative parametric insurance product that provides a form of protection to fund repairs following storm damage to coral reefs has now been taken up in Hawaii, with a policy provided by global reinsurance giant Munich Re, according to arranger WTW.
Read the full article
WTW has designed a parametric trigger for a responsive tropical cyclone insurance arrangement that will support a United Nations Children’s Fund (UNICEF) initiative to provide sustainable disaster and climate change protection to meet the needs of vulnerable children.
Read the full article
At the COP27 climate change conference in Egypt yesterday the Vulnerable 20 Group of Finance Ministers (V20) of 58 climate vulnerable economies and the Group of Seven (G7) officially launched the Global Shield against Climate Risks, while the World Bank officially launched its Global Shield Financing Facility.
Read the full article
Hurricane Lisa’s landfall in Belize on November 2nd has triggered an innovative parametric insurance product that provides a form of protection to fund repairs following storm damage to the largest barrier reef in the Atlantic Ocean.
Read the full article
At the COP27 climate change conference in the coming days, the World Bank is set to announce the launch of the Global Shield Financing Facility (GS-FF), which will be an important new financing structure to channel capital to protect vulnerable nations against climate and disaster risks.
Read the full article
Given the challenges faced in an increasingly volatile and turbulent world, insurance and risk finance are key tools that can help to shift the balance of risk, while insurance-linked securities (ILS) can “securitize resilience”, according to United Nations Development Programme (UNDP) representatives.
Read the full article
The second session at our Artemis London 2022 conference on September 6th featured a panel discussion titled “Filling the Gaps”, where participants discussed climate and disaster risk, as well as parametric catastrophe bonds.
Read the full article
After increasing the size of its reinsurance sidecar transaction in 2021, followed by the issuance of its first catastrophe bond earlier this year, Hong Kong domiciled reinsurer Peak Re aims to further leverage the insurance-linked securities (ILS) market to close the protection gap.
Read the full article
Globally, insurance and reinsurance market losses from flooding have accelerated significantly, with a doubling in the total in a decade to reach US $80 billion over the 2011 to 2020 period, but then another acceleration into 2021 when they reached $20 billion alone.
Read the full article
At a recent climate finance focused event, Pakistan’s Minister for Climate Change, Sherry Rehman, called on international governments to place climate finance and losses at the heart of COP 27 talks next year, with catastrophe bonds one instrument seen as having a role.
Read the full article
