Aon sets up specialty practice to address protection gaps
Broker Aon’s reinsurance solutions business has launched its public private enterprise (PPE) specialty practice to address the global insurance protection gap.
Led by Emma Karhan, working alongside Jon Wood, the PPE practice will be initially based in London, focusing on terrorism and natural hazard risk and integrating with Aon’s credit & guarantee and government practice in the US. It will work closely with Aon Securities to provide a single global offering in the government space.
Aon said the PPE practice will also work with Impact Forecasting’s catastrophe modelling developers – to identify opportunities to develop coverages, and engage with the industry to build post-loss resilience within economies.
According to Aon, the Harvey, Irma & Maria (HIM) losses in 2017 highlighted that the protection gap generally prevails; less than 50 percent of the total economic loss from these events was transferred into the insurance industry, with government aid and flood plan recoveries exceeding the amount paid by the commercial market, despite the abundant capacity available in the re/insurance market.
Nick Frankland, UK CEO of Aon’s reinsurance solutions business, said: “The re/insurance industry has record levels of capital at a time when public entities need increased protection against the risks they face. In particular, there is great potential to make the most of this capital through parametric triggers. Aon has proven its ability to structure ground-breaking solutions on behalf of governmental, and quasi-governmental organisations, and we now intend to build on these successes to assist ultimately in the development of more robust economies across the world.”
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