A Memorandum of Understanding (MOU) has been signed at the 26th ASEAN Insurance Regulators’ Meeting & 49th ASEAN Insurance Council Meeting, to establish the ASEAN Renewable Energy Pool (AREP), which will support ASEAN governments’ renewable energy policies.
Signed by the ASEAN Reinsurance Working Committee (ARWC), the pool was first proposed by Malaysian Re at the October 2021 meeting. The MoU pledges support via underwriting capacity and the formation of the AREP under the supervision of the ASEAN Insurance Council (AIC).
It signals a joint commitment from participating ARWC Members to collaborate and lead the region’s insurance and reinsurance industry to support ASEAN countries’ efforts to achieve net zero targets and manage the impacts of climate change.
Malaysian Re will serve as manager of the pool. Other participating ARWC members include PT Reasuransi Indonesia Utama (Persero) (Indonesia Re), Vietnam National Reinsurance Corporation (VINARE), Cambodian Reinsurance Company (Cambodia Re), Thai Reinsurance Public Company Limited (Thai Re), and National Reinsurance Corporation of the Philippines (Nat Re).
“Given the potential challenges in respect of the capacity and expertise in ESG/Renewable Energy and the complexity of the solar, wind, and other renewable energy resources, the inherent financial risk associated with these ventures can be potentially overwhelming for one insurance company to manage effectively,” said Ahmad Noor Azhari Abdul Manaf, President & CEO of Malaysian Re.
“Therefore, there is a need for a group of companies to pool their resources and band together to form an insurance pool to underwrite the risks associated with these renewable energy sources.”
