African Risk to target ILS with Gallagher Re as reinsurance broker
African Risk Capacity, a specialist insurance company that provides parametric cover to African countries against climate and disaster events – as its reinsurance broker and risk advisor, has appointed Gallagher Re as reinsurance broker and risk advisor.
Gallagher Re aims to support ARC's resilience efforts including the transfer of climate and food insecurity risks in Africa.
The appointment includes the placement of portfolio cover in the reinsurance and capital markets by May 1, 2023, and the provision of strategic advisory for sustainable growth and portfolio diversification.
The design of alternative risk transfer mechanisms, such as insurance linked securities (ILS), is a core component of targeted development plans.
ARC’s growth plans foresee combined use of traditional and alternative capacity providers as part of a unique risk carrier structure that aims to leverage the private sector for a wide range of resilience applications across Africa.
Following the signing of the Memorandum of Understanding last November, on the sidelines of COP27, between ARC, CCRIF SPC (formerly the Caribbean Catastrophe Risk Insurance Facility) and the Pacific Catastrophe Risk Insurance Company (PCRIC) – and as lead and sole broker to all three developmental insurance risk pools – Gallagher Re will now support the goals of the MoU which is to raise their global visibility, reach and influence.
Antoine Bavandi, global head of public sector, parametric & climate resilience solutions at Gallagher Re, said: “We are deeply honoured to be selected by ARC Ltd to support its critical mission of promoting resilience solutions across Africa. We feel passionate about ARC, what it stands for and the actual impact it is making on livelihoods on the ground. ARC Ltd’s mission in particular resonates extremely well with our vision for climate resilience by leveraging traditional markets as well as ILS and ESG capital to support African Union countries with the most efficient risk solutions. We very much look forward to applying our expertise for the benefits of public and private sector clients, to continue to push for scaled-up resilience solutions.”
Malvern Chirume, chief underwriting officer of ARC, said: “The emergence of new risks and the high degree of global interconnectedness offer a unique opportunity to rethink our approach to climate and systemic events on the African continent. ARC Group plays a critical role in this environment, strengthening the capacity of member states to minimise the risk and actual impact from these events, and providing targeted and swift access to finance, tools and products in the aftermath of disasters. To date, ARC Ltd has provided financial protection in excess of USD 1 billion to 19 countries. We aim to reduce the protection gap even further and our partnership with Gallagher Re will be a key element of our growth.”
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