LONDON, May 15, 2014 (GLOBE NEWSWIRE) -- Willis Group Holdings plc (NYSE:WSH), the global risk adviser, insurance and reinsurance broker, has secured US $55 million of index-based reinsurance capacity from the international weather risk markets for Africa's first ever catastrophe insurance pool, Africa Risk Capacity Insurance Company Ltd (ARC Ltd).
ARC Ltd, a Bermuda based mutual insurance company, has been set up to issue insurance policies against drought to an initial group of five African countries: Kenya, Mauritania, Mozambique, Niger and Senegal. It will allow member countries to respond quickly to a developing crisis, and rely less on uncertain international aid in times of drought. Teams from both Willis Re and Willis's Global Weather Risks Practice were involved in shaping the structure of ARC Ltd's reinsurance programme.
David Simmons, Managing Director of Analytics at Willis Re, said: "The underlying insurance policies issued by ARC Limited are cutting-edge index-based coverages, with parametric triggers tailored to reflect each country's specific rainfall requirements for growing staple crops. The calculation of claims to the programme is based upon satellite rainfall data which is used to objectively determine whether a drought has occurred. This then allows claims to be calculated quickly, and as a result, funds can be deployed in a timely and efficient manner. This is one of the first times in Africa that the reinsurance process has become such a key instrument in achieving humanitarian and development goals."
Julian Roberts, Executive Director of Willis's Global Weather Risks Practice, commented: "A mechanism such as ARC Ltd demonstrates the very best of what can be achieved when governments and the re/insurance sector work together, and has the potential to increase the resilience of African countries to the climatic challenges which they face."
Claire Wilkinson, Partner of Willis's Global Weather Risks Practice, added: "We noted significant appetite for this risk from both the reinsurance and index-based weather market, which were very keen to support something so innovative and ground-breaking. Despite keen pricing, the core layers of the programmes were around three times over-subscribed. It is heartening to see so much support from the re/insurance industry for a project that has the potential to do so much good."
About Willis
Willis Group Holdings plc is a leading global risk adviser, insurance and reinsurance broker. With roots dating to 1828, Willis operates today on every continent with more than 18,000 employees in over 400 offices. Willis offers its clients superior expertise, teamwork, innovation and market-leading products and professional services in risk management and transfer. Our experts rank among the world's leading authorities on analytics, modelling and mitigation strategies at the intersection of global commerce and extreme events. Find more information at our website, www.willis.com, our leadership journal, Resilience, or our up-to-the-minute blog on breaking news, WillisWire. Across geographies, industries and specialisms, Willis provides its local and multinational clients with resilience for a risky world. Willis Global Wealth Solutions was established in 2012 and has operations in Hong Kong, Singapore and Zurich.
About Willis Re
One of the world's leading reinsurance brokers, Willis Re is known for its world-class Analytics capabilities, which it combines with its Reinsurance expertise in a seamless, integrated offering that can help clients increase the value of their businesses. Willis Re serves the risk management and risk transfer needs of a diverse, global client base that includes all of the world's top insurance and reinsurance carriers as well as national catastrophe schemes in many countries around the world. The broker's global team of experts offers services and advice that can help clients make better reinsurance decisions and negotiate optimum terms. For more information, visit www.willisre.com.
About Willis Global Weather Risks Practice
Willis's Global Weather Risks Practice advises organisations on all aspects of evaluating, managing and transferring their exposure to adverse weather. Based upon an analysis of client's financial performance against historic weather data, the Willis Global Weather Risks Practice structures and executes bespoke insurance or derivative solutions that reflect the buyer's specific exposures, risk management objectives and budget.