Tokio Marine HCC, the specialty insurance players, has acquired GCube, a managing general agent (MGA) and underwriter focused on the renewable energy sector as well as weather risk transfer products.
GCube has a track record of underwriting weather risk transfer on a parametric and index basis for the energy sector and had also been linked with capital markets backed sources of reinsurance capacity to support its underwriting in the past.
For Tokio Marine HCC, the acquisition will expand its underwriting offering into sectors that align well with its own business and the purchase is expected to close in the second quarter of 2020.
“We are pleased to acquire this outstanding underwriting organization and welcome the passion the GCube team of market-leading renewable energy professionals brings to the development of climate-friendly business models,” explained Susan Rivera, Tokio Marine HCC’s Chief Executive Officer.
GCube is one of the biggest underwriters of risks facing the renewable energy sector around the globe.
Its underwriting products include coverage of wind, solar, bio, hydro, wave and tidal projects globally, taking on a range of exposures facing these industries including often the weather related risks that affect their generation ability.
GCube writes global property and liability cover for renewable energy construction and operational risks in 40 countries around the world and has become one of the most significant capacity providers to this market.
The importance of hedging weather exposures for these sectors is clear, as variability and extreme weather can be a serious detriment to their productivity.
The MGA leverages reinsurance capital from a range of sources and we understand has worked with some alternative reinsurance capital or ILS providers in the past.
Access to robust weather risk transfer solutions is vital for the renewables and alternative energy industry, hence it’s seen as a key growth area and as one of the specialist underwriters that makes GCube a very attractive business at this time.
“This strategic investment underlines our commitment to the renewable energy insurance market and our desire to actively address the issues around sustainability, helping us move towards a safe, secure and sustainable future. GCube also adds significant weight to our existing classes of specialty insurance and is in line with our strategy of acquiring businesses which possess real market-leading expertise, complement our existing portfolio and offer opportunities for growth and diversification,” added Barry Cook, Chief Executive Officer of Tokio Marine HCC – International Group.
Fraser McLachlan, GCube’s Chief Executive Officer, stated, “We are delighted to become part of the Tokio Marine HCC family. The group’s corporate social responsibility efforts, financial strength and global reach leave us ideally positioned to continue our expansion in one of the most vibrant and evolving sectors of the market.”
“We have worked closely with the GCube team for a number of years, and their addition to our group is a natural extension of this relationship. The renewable market offers significant opportunities for growth, and GCube’s 25 years’ experience as a global leader clearly positions Tokio Marine HCC as an important trading and innovation partner in this emerging field,” commented Simon Button, Chief Underwriting Officer – London Market division of Tokio Marine HCC – International Group.
GCube employs approximately 50 people and is based in London with additional offices in Amsterdam, New York and Newport Beach, California.