Eight Lloyd’s syndicates are joining forces to tackle the problem of underinsurance in emerging economies across Latin America, Africa, and Asia—committing capacity of $400 million towards solutions that address natural catastrophe risks in these areas.
While these economies currently contribute 40 percent to global GDP, they represent only 16 percent of global insurance premiums, Lloyd’s said, announcing the collaborative effort to improve their resilience against the economic impact of natural catastrophes.
The initial group of Lloyd’s syndicates participating are managed by Amlin, Beazley, Hiscox, Mitsui Sumitomo Insurance Group, Nephila, RenaissanceRe Syndicate Management, Tokio Marine Kiln and XL Catlin. Membership is open to the entire Lloyd’s market, however, and other managing agencies are welcome to participate.
The group has issued an open invitation to work with international organizations including but not limited to the World Bank and the British government’s Department for International Development. It will also look to strengthen its existing ties with several current global initiatives, such as the Insurance Development Forum created by the International Insurance Society.
The group plans to engage with governments, municipalities, and non-governmental organisations, in addition to Lloyd’s usual, valued client base.
Tom Bolt, Director of Performance Management at Lloyd’s, said: “This collective initiative means the Lloyd’s market can help provide the insurance solutions needed to build resilience to natural hazards and promote risk awareness around the world. We are keen to work closely with organizations across the globe to help protect economic growth in developing countries.”
Lloyd’s said that diversification of risk through well-designed risk sharing initiatives will be a key to deploying the committed capacity effectively.