The Singapore catastrophe modeling and analytics company said it has licensed its China Agriculture model to both Swiss Re and the People’s Insurance Company of China.
ARC declined to disclose financial details, but the company touted the agreements as taking it closer to becoming the agriculture risk modeling-standard for China. With the two new licensing deals in place, ARC said it now covers 59 percent of the Chinese agricultural insurance premium and 25 percent of the premium underwritten by reinsurers.
Both deals are big. Swiss Re bills itself as the leading international reinsurer for agriculture in China. And PICC is the biggest agriculture insurer in China with a 55 percent market share, ARC said.
As ARC noted, the total agriculture insurance premium in China has become significant, hitting $5 billion in 2013, with expectations of reaching $8 billion by 2017 as agriculture entities in the world’s most populous nation deepen their insurance coverage and consider expanding into new areas such as aquaculture.
“The main concern of the industry is the loss potential resulting from a large scale event such as drought, which impacts crops and livestock exposure and increases the forest fire activity,” August Boissonnade, ARC’s chief technology officer, said in a statement. “This is what we holistically address in our model.”
ARC is relatively new as a standalone entity. The 25-employee company was incorporated in Singapore and California in 2011, according to its web site, and maintains offices in Singapore, California and India. ARC is an affiliate of California-based Risk Management Solutions (RMS), one of the industry’s major catastrophe risk management and modeling companies, and ARC is part of the Daily Mail and General Trust, an international group that is quoted on the London Stock Exchange. CEO Roman Hohl is a veteran of reinsurance companies including Swiss Re, Converium and Partner Re and has agriculture insurance experience in Brazil, Vietnam, China and Mongolia, ARC said on its web site.