Global climate risk solutions platform, Arbol, has reportedly transacted more than $100mn in gross written premiums (GWP) in the first half of 2022, marking significant growth compared to the $70mn in GWP transacted in 2021.
The traction and scale the Arbol platform continues to see, according to Sid Jha, Arbol’s Founder and CEO, is a testament to the market demand for end-to-end parametric climate risk solutions.
The company’s automated pricing platform – powered by smart contract (blockchain) and AI technology – enables users to get live pricing directly through the app in a matter of minutes.
Since its launch in early 2020, the company’s premium growth expanded rapidly, from $2mn transacted in the first eight months to more than $100mn this year.
According to the announcement, the premium transacted in H12022 came from businesses in the agriculture, energy (traditional and renewable), and reinsurance sectors.
Premium sizes booked through Arbol’s platform ranged from premiums as small as $500 to millions of dollars, covering a range of clients from smallholder farmers and agribusinesses to utilities and institutional clients.
Jha commented: “As volatile weather conditions like record droughts in Texas continue to hurt expected crop yields for agribusinesses and farmers, the need for data-driven and objective financial products like insurance have never been more essential.
“Parametric coverage, powered by next generation technology and data has the ability to bring both better efficiency and transparency to the weather risk market while chipping away at the sizable global coverage gap for climate disasters.”
Arbol’s products offer parametric coverage which pays out based on objective data triggers rather than subjective assessment of loss.
This year Arbol has paid hundreds of agricultural clients tens of millions of dollars this year to cushion against the devastating drought in the Texas area. Additionally, in the energy space, Arbol said it is working with the wind energy sector providing a range of products to reduce revenue volatility for wind farms due to wind speed variations.
Hong Guo, EVP and Chief Insurance Officer, Arbol, said: “Stakeholders around the world of every size are waking up to the urgent reality that climate risks need to be properly managed.
“We are always looking to address gaps that exist in the wider market to enable effective and forward looking climate risk solutions. Our entire ecosystem for managing climate risk, bringing data, rapid pricing tools, and risk capacity under one roof is aimed at giving global businesses all of the tools needed to build lasting climate resilience in one place.”