Marsh, Munich Re & Metabiota launch parametric pandemic insurance

Global broker and risk consultancy Marsh has launched PathogenRX, an insurance product designed to protect businesses against pandemic risks such as the outbreak of infectious diseases, that utilises a parametric trigger provided by epidemic risk modeling specialists Metabiota and capacity from reinsurance giant Munich Re. The impact of infectious disease outbreaks and other pandemics can be significant for businesses, ranging from direct impacts to extensive business interruption, which makes a parametric triggered event definition and risk transfer solution, backed by global reinsurance capacity a valuable product for corporate risk managers. Of course this also meets the mandate of the major reinsurers such as Munich Re, bringing their reinsurance risk capital direct to the corporate market through such arrangements, while also helping to narrow an evident gap in traditional re/insurance protection. Marsh said the solution can help to minimise financial losses caused by the outbreak of pandemics, citing the PathogenRX product as the “world’s first integrated risk solution for measuring and protecting against economic impact of infectious disease outbreaks.” The insurance product will be offered to U.S. based companies, but can also protect their global operations as well. An attractive prospect for corporate risk managers for whom the impacts of epidemics and pandemics could be significant. “Pandemics and epidemics are not your average risk. They may occur over several months, are often not confined to a specific region, and their unpredictability means they can scale, grow, and become quite costly to a range of businesses from hotels and restaurants to schools and airlines,” explained Martin South, President of Marsh’s US and Canada Division. Marsh highlights that disease outbreaks such as Zika, MERS, and SARS can cause a significant financial impact to businesses and even whole industries that depend on the free movement of people, without fear for safety or health. Citing data from a study, Marsh noted that as many as 90% of Miami, Florida businesses in an area that was badly affected by the 2016 Zika virus outbreak suffered a revenue and profit loss of as much as 40%. Historically, businesses have not been able to measure the potential economic loss from a pandemic or epidemic, or effectively protect their bottom lines using insurance. Something this new product will now help them to do. Working in collaboration, Marsh, Munich Re and Metabiota developed PathogenRX, which they call a fully integrated pandemic risk solution. It uses triggers such as Metabiota’s new Pathogen Sentiment Index, which the epidemic risk specialists launched recently, as reported at the time by our sister site Reinsurance News. This Index offers insight and analytics into infectious disease outbreaks, helping businesses to model their potential financial exposure to an outbreak and protect against this risk using insurance policy underwritten by Munich Re. These policies can be highly customised, so as to tailor coverage for specific expenses, geographies, types of disease, or portions of a calendar year, Marsh explained. “Metabiota’s mission is to make the world more resilient to epidemics and to accomplish this means working with insurance industry leaders, like Marsh and Munich Re, to develop new offerings to minimize the economic repercussions that can result from infectious diseases,” Bill Rossi, CEO of Metabiota said. “Our Pathogen Sentiment Index combines our team’s in-depth scientific knowledge with a novel way to measure the potential impact to consumer travel and spending as a result of an outbreak and trigger the necessary resources to offset it.” “With PathogenRX, we are pushing the boundaries of insurability. Businesses now can better prepare for the potential of an epidemic or pandemic with a highly customizable risk modelling and transfer solution,” added Gunther Kraut, Head of Epidemic Risk Solutions at Munich Re. “This joint effort is an important part in our continued strategic push for innovation. It will pave a new frontier for the insurance industry by helping businesses become more resolute to the evolving health threats facing the world.” Christian Ryan, US Hospitality, Sports and Entertainment Leader at Marsh and based in Dallas, explained to Artemis that the use of parametric triggers will mean payouts can be determined much more quickly, while coverage can be tailored to the needs of the insured. The global nature of the product means that international businesses, such as in the hospitality sector, can attain coverage that could provide rapid pay outs to help their finances when business interruption, or expense due to the outbreak of diseases occur. The product is another good example of parametric triggers enabling gaps in insurance protection to be filled efficiently, while pay outs can be disbursed more rapidly as well. The product will use the parametric factors for definition of an event, but unless a cedent has an identifiable financial loss from the event a payout wouldn’t be made, we understand. Hence the Metabiota index is an element of the overall payout trigger, but vital for identifying when an event qualifies under the terms of the insurance arrangement. To visit the original article on Artemis, please click here.

Marsh launches product to insure against pandemics

Global insurance broker Marsh has announced the launch of PathogenRX, a new product to protect US-based businesses and their global operations affected by an infectious disease outbreak. “Pandemics and epidemics are not your average risk,” said Martin South, president of Marsh’s US and Canada Division. “They may occur over several months, are often not confined to a specific region, and their unpredictability means they can scale, grow, and become quite costly to a range of businesses from hotels and restaurants to schools and airlines.” Infectious diseases can have drastic impacts on industries that depend on people moving freely without fear of their safety or health, Marsh said. A recent study found that, in an area of Miami especially hard-hit by the 2016 Zika virus outbreak, 90% of businesses saw revenue and profit losses of up to 40%. But businesses had no way to measure or protect against potential losses from an epidemic, Marsh said. To solve that problem, Marsh teamed up with reinsurer Munich Re and epidemic risk modeler Metabiota to create PathogenRX. The product uses triggers like Metabiota’s Pathogen Sentiment Index, which provides analytics into disease outbreaks, to allow businesses to more confidently project and protect against potential losses. The policy can be tailored to provide coverage for specific expenses, geographies, types of disease and times of year, Marsh said. “Metabiota’s mission is to make the world more resilient to epidemics, and to accomplish this means working with insurance industry leaders, like Marsh and Munich Re, to develop new offerings to minimize the economic repercussions that can result from infectious diseases,” said Bill Rossi, CEO of Metabiota. “With PathogenRX, we are pushing the boundaries of insurability,” said Gunther Kraut, head of epidemic risk solutions at Munich Re. “Businesses can now better prepare for the potential of an epidemic or pandemic with a highly customizable risk modeling and transfer solution. This joint effort is an important part in our continued strategic push for innovation. It will pave a new frontier for the insurance industry by helping businesses become more resolute to the evolving health threats facing the world.” To visit the full article by Insurance Business America, please visit this link.

Amazon Web Services Partner Story: Metabiota

Using Data to Confront Risks and Change Lives The 1918 Spanish Influenza pandemic stands as one of the deadliest flu pandemics in human history, killing 50 million and infecting an estimated 500 million worldwide. Many experts believe it’s not a question of if, but when, an epidemic of even greater magnitude will occur. The flu is but one example of an infectious disease with the power to cause catastrophic human and economic losses across a global population. While it may be impossible to prevent future epidemics, analyzing trends and events of the past while controlling for the conditions of the present can assist in modeling and mitigration of risk. Metabiota sits at the intersection of this combination of epidemiology and data science. The company helps its clients conduct risk analysis and assess the probability of human and financial losses caused by a potential epidemic through its comprehensive infectious disease platform. “You can’t necessarily eliminate pandemics or epidemics, but you can minimize their impact,” says Mike Gahan, senior data scientist at Metabiota. Metabiota uses hundreds of different data sources to build a range of models that run tens of millions of plausible event simulations. Each simulation represents a scientifically plausible, hypothetical scenario that accounts for variables that can affect the severity of epidemics. “With each client, our goal is to put ourselves in the client's shoes and think about what they’re trying to accomplish,” says Cathine Lam, data scientist at Metabiota. “For example, how are governments hoping to use insights from our data to understand and mitigate risk to better address citizens’ needs in the face of an epidemic? How are insurance companies looking to leverage insights from our data to design a comprehensive insurance policy that mitigates economic losses and covers appropriate pathogens?”   For more on this story, visit here.

Metabiota unveils Pathogen Sentiment Index & agreement with Munich Re, Marsh

Epidemic risk modeller Metabiota has announced details of its Pathogen Sentiment Index, a tool that enables the estimation of public fear and behavioural change as a result of infectious disease outbreaks, and which is to be used to develop epidemic insurance solutions through an exclusive agreement with reinsurer Munich Re and broker Marsh. In August last year, Metabiota announced the launch of its commercial risk modelling platform and preparedness index for epidemic risks, as well as the signing of a strategic agreement with reinsurance giant Munich Re. Now, the epidemic risk modeller has revealed details of its Pathogen Sentiment Index, which will be used as the basis for innovative epidemic insurance solutions to be developed and brought to the marketplace by Munich Re and insurance and reinsurance broker, Marsh, under an exclusive agreement with the pair. Bill Rossi, Chief Executive Officer (CEO), Metabiota, said: “Infectious disease outbreaks can inflict enormous social and economic disruption and public fear and panic can only magnify those disruptions. Until now, that risk has been difficult to measure. By providing a comprehensive and objective methodology for quantifying the potential ripple effect of epidemic risk, we’re able to provide the insurance industry with the tools to underwrite risk and deliver polices to protect countries and corporations from financial blowback.” To read more of this article, click here.

Metabiota’s Pathogen Sentiment Index to Fuel Innovative Epidemic Insurance Offering for Travel & Tourism Industry

Today, Metabiota, the pioneer in epidemic risk modeling, unveiled details of its Pathogen Sentiment Index, a tool for estimating public fear and behavioral change driven by infectious disease outbreaks. The Index integrates Metabiota’s deep scientific expertise with extensive analytics into historical infectious disease outbreaks with consumer sentiment scoring for each pathogen. Under an exclusive agreement with Munich Re, a leading global reinsurance company, and Marsh, a global leader in insurance broking and innovative risk management solutions, Metabiota’s Index will be the basis for cutting-edge epidemic insurance solutions to be developed and brought to market by the companies. For the first time, travel and tourism businesses like hotels, airports, cruise ships and theme parks will be able to access a public fear trigger-based business interruption policy designed to protect against a significant financial loss resulting from an epidemic. To read more, visit this link.

Africa: Ebola, Other Diseases Piloted in New Insurance Programme

Johannesburg — The African Risk Capacity (ARC), an agency of the African Union, is developing an insurance product to facilitate rapid, first-line financial responses to disease outbreaks. In the pilot phase, Ebola, Marburg, Meningitis, and Lassa Fever will be covered. Over 30 countries across Africa are at risk of an outbreak of one or more of these four epidemic-prone diseases. The Ministries of Health in Guinea and Uganda, the two countries implementing ARC's Outbreak and Epidemic (O&E) Pilot Programme, selected these four pathogens due to the history-based potential for outbreaks and accompanying devastating impact on populations and economies. O&E builds on ARC's successes in implementing climate disaster risk financing programmes in Africa. It is designed as an integrated system to enable governments to respond early and effectively to public health emergencies. The programme will work with countries to determine their epidemic risks and select pathogens to be covered, optimize early warning systems, create pre-established contingency plans for rapid response, and provide access to swift disbursement of financing through parametric insurance. To read more about this program and Metabiota's involvement, click here.

CEO talks CRO: Importance of the role rising for global corporations

If your company doesn’t have a chief risk officer (CRO) today, it will soon. Given the multitude of risks facing today’s global business, it’s become a critical “C” level role in any organisation. While the specific role of the CRO varies from company to company, the essence of the job is the same. CROs and their organisations are tasked to manage and mitigate risk. What does this mean? It means being prepared for the unknown. How would you like that in your job description? The Evolution of the CRO For the CRO of Southwest Airlines in 2007, it meant preserving the company’s low fare business model during a period of highly volatile fuel prices. When oil prices spiked to over US$150 a barrel, Southwest successfully hedged its jet fuel purchases allowing them to keep fares low and maintain profitability. Other airlines didn’t fare so well (no pun intended) and were forced to match Southwest’s prices and absorb the hit to their bottom line. I cut my teeth in the telecommunications industry and witnessed the rise of the CIO (chief information officer). Though they didn’t have “risk” in their title, their job certainly looked a lot like today’s CRO. The CIO’s job was to bring their company into the digital age and navigate the choppy waters of the newly emerging internet economy. If you were the CIO of Blockbuster or Walmart, the challenges you faced were immense. You had a booming business, but a cloudy horizon with small upstarts like Netflix and Amazon promoting disruptive business models. What do you do? Build more brick and mortar stores or begin to hedge your strategy? Enter the CRO, whose role it is to understand the timing, likelihood and potential impact of a specified risk and mitigate it. The insurance industry learned about the importance of properly assessing risk the hard way. In the wake of Hurricane Andrew in 1992, the industry did not heed warnings by weather experts that predicted heavy rainfall and large storms and as a result, several insurers went bankrupt covering claims in the region. To read more, visit this link.

Zoonotic Threats: As Unpredictable as They Are Dangerous

In epidemiology, some things are highly predictable. For instance, it’s a sure bet that whenever the next outbreak of some strange-sounding disease occurs, the media will start calling, the public will start worrying, and the government will rush in with promises of new research funding. (See H1N1; West Nile; Ebola; Zika.) The boom-and-bust pattern of public attention repeats itself over and over again. What is less predictable is which particular disease will spark the next global health crisis. Public health experts believe the biggest threats are diseases transmitted from animals to humans. According to the US Centers for Disease Control and Prevention (CDC), more than 6 in 10 known infectious diseases are believed to be zoonotic, and three-quarters of new or emerging infectious diseases in humans are zoonotic. Yet, the goal of predicting precisely which zoonotic diseases will become epidemic remains elusive.   To read more of this article, click here.

Sparking a Disaster: New Blog Post on the 1918 Flu Pandemic

Sparking a Disaster Introduction This year marks the 100th anniversary of one of the deadliest natural disasters in human history - The 1918 influenza pandemic, also known as the “Spanish Flu”, which killed about 50 million people worldwide. Pandemic influenza is different than typical, seasonal influenza that circulates every winter, and it only happens when a new influenza virus emerges and spreads globally. In the past century, there have only been four influenza pandemics, with the "Spanish Flu" being the deadliest. When examining the spread of a pandemic and the likelihood of it happening again, it is important to first understand what sparks these types of events. To read more, visit this link.

ARC and Metabiota Tackling Africa's Epidemics

At various industry events, talk is often of the insurance gap that exists between indemnified losses and insured losses. This gap applies to both emerging and established economies. There is also considerable talk about the drive to establish new products. For the emerging economies, that means getting people accustomed to the concept of insurance, and in the established ones, it is about highlighting the benefits of such protection and ensuring that exposures are appropriately managed. Africa, and in particular the threat posed by epidemic disease, presents another series of challenges altogether, although it is hoped a new partnership between African Risk Capacity (ARC) and specialist risk modeller Metabiota will help close the insurance gap in the continent while also providing some much needed financial relief in the event of a disease breaking out. The new pioneering programme is designed to support the continent’s countries in evaluating their epidemic risk and ultimately help transfer some of the financial costs in mitigating and managing such exposures to the insurance industry. Events such as the Ebola outbreak hit countries with considerable costs, and figures from the World Bank suggest that managing the cost of the crisis may have exceeded $32bn. A further $2.2bn is thought to have been lost in the gross domestic product of three of the hardest hit African countries in 2015. The partnership between ARC, a specialised agency within the African Union, and Metabiota will help countries get a better understanding of the risks they are facing, and so that future outbreaks can be adequately and appropriately insured against. The insurance products that can be established would provide resources, financing and other forms of risk profiling and contingency planning in the event of an outbreak. “The ARC Outbreak & Epidemic Program allows each sovereign nation to respond faster and more sustainably to public health disasters by really doing assessments of each country’s ability to putt in motion plans in an outbreak event,” Dr Karen Saylors, vice president of field research for Metabiota, explained, adding: “It really allows an interesting insurance model because you’re dealing at the African continent level with sovereign nations who are making key decisions for the safety of their country rather than relying on international aid. “The first work stream is risk profiling, so it’s looking at the country’s capabilities, infrastructure and operational response capacity as it currently stands so a contingency plan can be put in place.” For more of the article, visit this link.