OAK Global is targeting increasingly interconnected climate and technology risks with the launch of OAK Horizon, a new underwriting arm designed to bring capital into emerging risk exposures, with CUO Tom Dickson noting that the window to address growing volatility across sectors including food security, energy and supply chains is shrinking.
Dickson, whose responsibilities have been expanded to OAK Horizon’s CUO as well as serving as president of innovation strategy, said the unit aims to lay the business foundation needed to address these evolving risks.
The company said the new business, supported by the capabilities of the existing Lloyd’s syndicate, will target a wide range of risk exposures, including catastrophe cover against evolving natural disasters, parametric insurance, energy and power-related financing and performance risks, technology-related asset protection and public sector partnerships.
“Internally, we have been strategizing and now with the external launch of OAK Horizon, the underwriting approach is really coming to fruition,” Dixon told Reinsurance News in an interview following the announcement.
He continued: “Timing is critical: investment in these areas is accelerating, and the impact of these risks is making the world feel riskier in a way. It’s exciting to be in the risk solutions business right now, but it also requires caution.”
“A key challenge is how to underwrite risks that don’t have a long-term history. This is where technology comes in, bringing in new data sets from the traditional insurance and reinsurance world and combining them with underwriting expertise and analytics. The goal is to improve the way we assess risk and deliver solutions.
“We hope to establish ourselves as a leader in this space by working closely with our partners. We already have strong connectivity in the market and have invested in the right building blocks from the outset, and we are excited about the significant commercial opportunities ahead.”
Dickson said OAK Horizon aims to deliver compelling propositions to clients and partners, including brokers, insurers and MGAs, by combining specialized underwriting expertise to build solutions for complex risks and unlock placement opportunities that would otherwise be unavailable.
He added: “When I joined OAK Global last June, my background was in new product development and innovation, primarily in the energy infrastructure sector. It’s really exciting to bring that expertise together here.
“With less than 18 months in operation, we are now well positioned to launch another strategic business unit, built around managing complexity and driving innovation.
“By innovation, I don’t just mean product innovation, developing creative underwriting structures, but also finding new ways to deploy capital to address these risks.
“For us, this includes a combination of parameters in areas such as climate, weather, energy and agriculture. It’s about the intersection of climate and technology, and building an ecosystem to address these challenges.
“OAK Horizon is designed to bring capital into these high-demand areas with the goal of building resilience across the real economy for consumers and businesses. We will work with our capital partners to support the continued growth of this strategy.”
Looking ahead, Dixon said the near-term focus will be on executing and building a diversified portfolio that is both stable and profitable, while reflecting the division’s strategic objectives.
“We will certainly be active in the market, evangelizing our approach and seeking partners and connections. Now, our task is to put our plans into action, fulfill the processes we have been developing since last year and build a first-year underwriting portfolio,” he added.
Dickson concluded: “The portfolio will be diversified, combining natural catastrophes and climate change coverage with other areas of the finance world and next-generation engineering assets such as new energy infrastructure and supply chain risks. Many of these risks are uncorrelated, which helps create a robust portfolio.
“Our first priority in the first year will be careful execution to ensure we deliver on the strategy we have laid out and build a solid foundation for growth.”
In an initial release published earlier today, OAK Global founder, CEO and group COO Cathal Carr said: “The intersection between climate and technology will create significant opportunities for the risk landscape over the coming decades.
“From a climate resilience perspective, advances in technology and data can enhance the pricing and structuring of changing weather risk transfers, supporting reinsurance/insurance penetration to close protection gaps through traditional and parametric solutions.
“Technological innovation can improve the efficiency of meeting the energy and power needs of an evolving global economy, with opportunities to enhance energy security and reduce reliance on cost-prohibitive and limited legacy systems.
“In addition to advancing risk solutions, technology innovation also creates challenges when we consider the needs of next-generation engineering assets such as data centers and the risk uncertainties associated with emerging technologies such as nuclear fusion.”
“OAK Horizon takes a systems-based approach to address this growing demand ecosystem, partnering with our clients to create value for our investors and support economic resiliency.”
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