ASR creates new parametric partnership
Africa Specialty Risks (ASR) has formed what it says is a landmark parametric reinsurance partnership with a leading European reinsurer, to increase its coverage for vulnerable populations and economies in Africa and the Middle East.
The agreement will double ASR’s parametric capability for smallholder farmers, natural perils and renewables, with the prospect of further expansion in the future. The partnership was facilitated by Inver Re.
Food, water, and environmental security, exacerbated by climate change, represent key challenges for Africa and the Middle East, said ASR. Insurance is increasingly being recognised in the key policy circles as an effective remedy, but further insurance penetration is needed. The parametric approach to reinsurance championed by ASR facilitates the flow of capital to support vulnerable populations.
According to the company the region has already benefitted from efforts in recent years by ASR’s parametric division, providing resilience and paying for claims on weather, climate, and seismic risks, as exemplified through ASR’s Mozambique Cyclone Parametric Reinsurance Program.
Dr Raveem Ismail, head of parametric underwriting, ASR said: “This partnership really is a step forward. Although there have been efforts to increase the flow of reinsurance capital into Africa over the past decade, few have come in the context of a commercial entity specifically focused on risks in the region. ASR is fully committed to Africa and the Middle East and we are delighted to be able to double our parametric capabilities.”
“It has been an honour and a pleasure to support this new partnership,” said Tom Johansmeyer, global head of index, Inver Re. “While many are shy of the challenges associated with risks in the Global South, the opportunity is significant, and creative thinking can make it more attainable. This partnership, built on the strength of ASR’s index development and deal sourcing capabilities and both parties commitment to Africa and the Middle East, should serve as a model for expanding worldwide reinsurance support for risks in the Global South.”
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