Global insurance broker Howden has announced the launch of Parhelion, a highly rated environmental, social and governance (ESG) focused, fully sustainable insurance carrier which aims to commence underwriting from January 1st, 2022.
The new insurer is targeting a capital raise of USD 500 million and is being advised by Howden Capital Markets and TigerRisk Capital Markets & Advisory.
Seed funded by Howden, Parhelion will match the growing volume of institutional capital searching for sustainable investment strategies with the growing demand from corporates looking for an insurer to support their ESG transition.
Driven in part by the impacts of climate change, responsible and sustainable investing continues to gain traction. In fact, as at the end of 2020, more than USD 40 trillion of assets globally were invested in ESG-aligned and sustainable impact strategies, although only a small portion of this has been deployed across the re/insurance sector, notes Howden.
Enter Parhelion, which, launched against the backdrop of an industry “starved of truly sustainable capacity”, will bring new and diversified ESG products designed to meet the risk financing needs of a greener economy.
According to Howden, the business will look at risk through a new lens in order to support a unique underwriting approach based on data, technology and proprietary ESG criteria.
The broker continues to explain that studies have shown a persistent and strong correlation between corporates with advanced ESG credentials and low insurance claims, which enables Parhelion to offer premium and cover at advantageous terms, while at the same time generating strong returns for shareholders.
The new insurance company will offer traditional risk coverage and also create new ESG-specific solutions for risks of the future.
Re/insurance and climate risk finance experts, Julian Richardson and David Cabral will lead Parhelion as Co-Chief Executive Officers (CEOs), and will be joined by reinsurance executive Chris Sharp as Chief Underwriting Officer (CUO) in September, 2021.
Charlie Langdale, Head of Sustainable Insurance, Howden, commented: “We’re delighted to offer a unique solution for our clients who are in need of a new and sustainable approach to the risks of the future. Parhelion will be an unencumbered highly rated ESG focused carrier backed by fresh capital that our clients can partner with and trust. Its launch is a step towards facilitating long-term industry change.”
Co-CEOs of Parhelion, Richardson and Cabral, added: “Companies are transitioning to sustainable procurement and this should not be limited to physical good; it must also include financial services and products. Our vision is to support customers’ transition to a more sustainable and resilient future while creating a virtuous cycle of improved risk control and underwriting performance, irrespective of the market cycle. This vision will be supported by an ecosystem of services and shared data insights to support the overall customer ESG transition.”