ILS Insight 2021 - The Origin of Innovation
16 July 2021
Bedell Cristin is pleased to have sponsored the recent ILS Insight '21 webinar focusing on Guernsey's success with innovation in the insurance sector.
We are long standing supporters of We Are Guernsey's ILS Insight series and this year's event was no exception, with our own Mark Helyar moderating. Mark began the event by reminding the audience of Guernsey's history as a jurisdiction of world firsts, including the introduction of protected cell companies and the listing of insurance products, such as the Salam III Islamic bond that securitised Shariah compliant takaful insurance.
The audience then heard from two speakers about new innovative structures. A theme highlighted is that Guernsey's ability to lead on innovation is made possible by the expertise of Guernsey's service providers and its regulatory regime.
Volcanic eruption catastrophe bond
A new world first for Guernsey in the ILS space was showcased by Cedric Edmonds of Replexus. Replexus has used a Guernsey ILS structure for the world’s first catastrophe bond covering pure volcanic eruption. A US$3 million bond, sponsored by the Danish Red Cross, has been issued through a Guernsey reinsurance structure, Dunant Re IC Limited – an incorporated cell of Replexus ICC (Guernsey) Limited, which is managed in Guernsey by Aon Insurance Managers. The bonds were settled using Replexus’ unique blockchain-based ILS platform, the ILSBlockchain. The catastrophe bond covers the risk of eruption of 10 volcanoes across three continents and raised capital to support humanitarian aid in the aftermath of an eruption. During the webinar, Cedric explained that one of the main reasons why Replexus chose Guernsey was the quality of its service providers.
Parametric fuel insurance
Outside the ILS sphere, but continuing the trend of innovation, the webinar also heard from Gus Majed of Paratus Group. Paratus Group has chosen Guernsey to launch the world’s first parametric fuel price insurer, Paratus Maritime Insurance Limited (PMIL), to create price certainty, allowing policy holders to manage volatility while complying with new rules to limit sulphur in fuel oil on ships and a scheme to facilitate carbon neutral growth. Robus Group acted as insurance manager. It is noteworthy that PMIL was able to become licensed as an insurer by the Guernsey Financial Services Commission within weeks. A key feature of Guernsey's regulatory landscape is the access to an engaged regulator that is open to innovation and can provide approvals within a short timeframe.
The Bedell Cristin team is proud to continue to support the island's insurance industry in its development of exciting and innovative products.
Watch the full webinar here.