Appleby Advises ARC On Epidemic Insurance
Appleby Bermuda advised ARC Ltd, a long-standing client, on its first parametric insurance product against high-impact epidemic risks.
A spokesperson said, “The insurance product will provide parametric insurance to African Union [AU] member states for three selected pathogens responsible for Ebola virus disease, Marburg virus disease, and Meningitis. Senegal will become the first African country to benefit from this innovative risk financing instrument against diseases of epidemic potential and paves the way for participation by other member states of the AU.
“African Ministers of Finance in 2015 requested ARC to develop a product to meet countries’ rapid funding needs to contain high-impact infectious disease outbreaks and complement the efforts of the Africa Centres for Disease Control and Prevention. On 8 December 2022 ARC announced the launch of the product.”
“In our perspective of diversifying our product offering aimed at protecting the most vulnerable populations of our continent, we are today launching this new sovereign risk transfer mechanism through parametric insurance, which will allow our Member States to benefit, in addition to insurance against climate-related disasters, from coverage against epidemic risks,” said UN Assistant-Secretary-General and ARC Agency Director General Ibrahima Cheikh Diong. “We are confident that these predictable financing tools coupled with operational plans will strengthen the response capacity of our Member States while developing their expertise in the face of public health emergencies”.
The spokesperson said, “Appleby’s role included establishing the segregated account framework for ARC Ltd to create the legal and operational framework for this globally unique program, demonstrating Appleby’s commitment to support development insurance programs designed to expand global public benefit and to protect vulnerable communities.
“Brad Adderley, Bermuda Managing Partner, led the transaction with support from Partner Gary Harris, Counsel Josephine Noddings and Associate Amber Farrington.”
Brad Adderley said, “Congratulations to the highly dedicated ARC Ltd team on the launch of their first parametric insurance product against high-impact epidemic risks. This innovative and globally significant risk financing instrument will help Africa’s most vulnerable countries. We are proud of our decade-long relationship with ARC Ltd, and are pleased to support them as they continue to further innovate and build resilience against natural disasters, such as outbreaks and epidemics perils.
The spokesperson said, “The epidemic risk was modelled by Ginkgo Bioworks; and the insurance product is issued by ARC Ltd, a financial affiliate of ARC Agency an intergovernmental organization. The insurance product is mainly reinsured by Munich Re; the insurance brokerage service was performed by AON; and the insurance premium was subsidized by the Swiss Agency for Development and Cooperation [SDC].”
