Reinsurance

✓ Climate adaptation

1. Leadership in modelling and pricing of climate risks:1.1. The reinsurance activity uses state-of-the-art modelling techniques that:are used to properly reflect in the premium level the exposure, hazard and vulnerability to climate change risks as well as actions taken by the policyholder of the insurer to protect the insured asset or activity against those risks, where such information is provided by the insurer to the reinsurer;do not only rely on historical trends;integrate forward-looking scenarios.1.2. The reinsurer discloses publicly how the risks stemming from climate-related perils are considered in the reinsurance activity.2. Supporting development and supply of enabling non-life reinsurance products:2.1. The reinsurance activity’s underlying products cover risks stemming from climate-related perils and reward, in a risk-based manner and without prejudice to legal restrictions on contractual conditions and insurance premiums, preventive actions taken by the insurer’s policyholders.2.2. The reinsurance activity complies with one or more of the following criteria:where desired by the insurer, the reinsurer engages with the insurer, either directly or via a reinsurance intermediary, during the development of the underlying product by:discussing possible reinsurance solutions that the reinsurer is willing to offer in relation to that product. The final product is brought to market using one of the reinsurance solutions that were discussed with the reinsurer during the product development phase;providing data or other technical advice enabling the insurer to price the coverage for risks stemming from climate-related perils as well as risk-based rewards for preventive actions taken by the insurer’s policyholders;the insurer would likely reduce or discontinue its coverage under the underlying product without the reinsurance agreement or a comparable reinsurance agreement in place;the reinsurer provides, as part of the business relationship with the insurer or the reinsurance intermediary, data or other technical advice or both enabling the insurer to offer coverage of risks stemming from climate-related perils and the coverage allows for risk-based rewards for preventive actions taken by the insurer’s policyholders.2.3. Where a reinsurance product applies at the level of a portfolio of underlying products, only a share of the reinsurance activity’s underlying products may cover risks stemming from climate- related perils and reward, in a risk-based manner, preventive actions taken by the insurer’s policyholders for the purpose of point 2.1. In that case, the reinsurer is able to identify the share of reinsurance premiums that relate to those underlying products.3. Innovative reinsurance coverage solutions:3.1. Reinsurance products sold under the reinsurance activity offer coverage for risks stemming from climate-related perils where the demands and needs of the insurer’s clients, based on the underlying products, require so. Such insurance products appropriately reflect risk-based rewards for preventive actions taken by the insurer’s policyholders.3.2. Depending on the demands and needs of the individual customers of the insurer, reinsurance products may include specific risk transfer solutions which may include protection against business interruption, contingent business interruption, other non-physical damage-related loss factors, cascading effects and interdependencies of hazards (secondary perils), cascading impacts of interacting natural and technological hazards or critical infrastructure failures.4. Data sharing:4.1. With due regard to Regulation (EU) 2016/679, a significant share of loss data related to the reinsurer’s activity is made available, free of charge, to one or several public authorities for the purpose of analytical research. The public authorities declare to use the data for purposes of enhancing adaptation to climate change by the society in a region, country or internationally and the reinsurer provides the data at a level of granularity sufficient for the use declared by the respective public authorities.4.2. Where the reinsurer is not yet sharing such data with a public authority for the aforementioned purpose, it has declared the intention to make its data available, free of charge, to interested third parties and has indicated under which conditions such data can be shared. That declaration of intention to share available data is easily accessible, including on the reinsurer’s website, for relevant public authorities.5. High level of service in post-disaster situation:Claims under the reinsurance activity, both ongoing and those from large-scale loss events resulting from risks stemming from climate-related perils, are processed fairly with respect to customers, in accordance with high handling standards for claims and in timely fashion in line with applicable law and there has been no failure to do so in the context of recent large-scale loss events. Where appropriate, the reinsurer supports the insurer or the reinsurance intermediary in assessing the claims from the underlying product. Information as regards procedures on additional measures by the reinsurer in case of large-scale loss events is publicly available.