Munich Re Specialty – Global Markets, Syndicate Launches First of its Kind Insurance Consortium Offering Catastrophic Communicable Disease Coverage

Munich Re Specialty – Global Markets, Syndicate today announces the creation of The Pandemic Consortium, a Lloyd’s market initiative which will be focused on offering parametrically triggered catastrophic communicable disease insurance ¹. The consortium will offer a proactive emerging risk transfer solution to mitigate against the impacts caused by pandemic and epidemic risks.

Many businesses are not covered against this risk in their insurance policies and face a protection gap without the solutions the consortium provides. This is despite modelling experts such as Metabiota ² and Airfinity ³ predicting a close to 1 in 3 chance of another pandemic on the scale of COVID-19 within the next 10 years.

The consortium, based in London, will benefit from the unique experience and expertise of Munich Re’s Epidemic Risk Solutions unit (ERS), represented in London, Munich and Singapore. The ERS unit, which has been writing risk since 2017, will provide expertise, aggregation guidance and underwriting rigour to the new consortium, allowing consortium partners to offer a collaborative solution for potential catastrophic outbreaks in future.

Dominick Hoare, Group Chief Underwriting Officer, Munich Re Specialty – Global Markets said: “While COVID-19 remains a vivid memory for many, the risk of future pandemics and epidemics globally remains high. This innovative insurance solution, developed with the support of our partners, is designed to help businesses better prepare for and respond to these risks. Its transparent triggers and rapid payouts once these triggers are met demonstrate how the insurance industry can proactively deliver effective solutions to help the economy stay on track amidst public health disruptions.”

As well as providing protection for businesses, The Pandemic Consortium will also be relevant at a national level. The recently published report ⁴ by the G20 High Level Independent Panel on Financing the Global Commons for Pandemic Preparedness and Response, recommends significantly expanding business interruption insurance to improve economic stability and free up government resources for pandemic preparedness and response.

Dr. Gunther Kraut, Global Head of Epidemic Risk Solutions, Munich Re said: “The Munich Re ERS team is proud to support The Pandemic Consortium with our longstanding expertise and knowledge in epidemic and pandemic risk. Expanding the reach and distribution of this expertise through the Syndicate’s consortium partners will help businesses better plan and prepare for future risks – while at the same time enabling a sustainable approach to managing aggregate capacity for this challenging risk.”

Notes to editors

1. Coverage can be triggered by 3 objective data points 1) WHO report a new outbreak 2) WHO declare a public health emergency 3) Civil authority restrictions are issued in relation to the disease within a covered area
2. Rebranded Ginkgo Bioworks in 2022  (Cheney, devex, 31 July 2021)
3. London-based disease forecasting company (Fortune, Apr 18, 2023 and Bloomberg, Apr 14, 2023)
4. See G20 report at this link