Aon, a global re/insurance broker and risk adviser, and Munich Re, a leading global reinsurer, have launched a first-of-its-kind pandemic reinsurance solution for Indonesia and the Philippines.
The solution is designed to help organisations address non-damage business interruption losses arising from a pandemic, a risk typically excluded from property and casualty insurance policies, except in areas such as medical and travel insurance.
Governments, businesses and communities remain significantly exposed to pandemic risk, which has the potential to disrupt trade, supply chains, travel, hospitality and public services on a large scale.
Through the solution, Aon can access dedicated, highly rated pandemic capacity for clients in the hospitality industry, with Munich Re providing the reinsurance capital, pricing and policy wordings.
The solution combines indemnity-based coverage with parametric triggers, aiming to provide greater clarity and confidence around coverage responses, subject to policy terms, while supporting a more efficient approach to risk transfer.
It has been developed for clients in Indonesia and the Philippines, where Munich Re and Aon teams identified specific coverage needs and designed a solution to address them.
Soeren Soltysiak, CEO of Asia, Reinsurance Solutions, Aon, said, “The COVID-19 pandemic highlighted the protection gap for this peril, particularly for non-damage business interruption losses. It also reinforced the need for new solutions that help organisations build greater financial resilience and confidence ahead of potential future outbreaks. By combining specialist reinsurance capacity with a solution specifically designed for pandemic-related losses, we will help clients achieve greater clarity and confidence in how they can protect their balance sheets against possible future events.”
Hitesh Kotak, CEO, Asia, Munich Re, commented, “Pandemic risk remains one of the most significant protection gaps facing economies across Asia. This solution provides organisations in Indonesia and the Philippines with greater access to protection against pandemic-related disruption and supports their ability to recover and grow following future public health events.”
Dr. Gunther Kraut, Global Head of Epidemic Risk Solutions, Munich Re, added, “Epidemic and pandemic risk requires robust approaches to risk sharing and capital deployment. Similar to other perils, affirmative specialist insurance solutions are required to help address the challenge of global risk accumulation. Munich Re is committed to supporting solutions that help clients manage the financial consequences of these events.”
