Specialty insurer, Mosaic Insurance has raised capacity from $15 to $30 million per political risk to support green finance in developing economies.
This move was made by leveraging both its Lloyd’s Syndicate 1609 and trade-partner capital through its syndicated management program.
Additionally, the insurer also lengthened the tenor, or term provisions, of loan coverage from 10 to 15 years for political-risk insureds such as multilateral and state-owned development banks.
The moves, Mosaic highlighted, underscore the insurer’s emphasis on sustainable finance in the sector, particularly around green-energy projects that assist emerging nations hard-hit by post-pandemic economic and geo-political shocks.
Finn McGuirk, Mosaic’s Head of Political Risk, commented: “This is an essential step allowing us to match the market’s appetite for longer-tenor projects and sustainable finance around meaningful infrastructure schemes.
“We’re seeing an increase in these types of loans using blended finance tools and innovative products like ‘blue bonds’ that generate funding for marine ecosystems—it’s a win-win for low-income countries and supports their long-term economic stability.”
An example was Mosaic’s recent participation in a ground-breaking debt-for-nature swap that will help conserve the remote Galápagos Islands.
The blue-bond deal, led by the government of Ecuador, the US International Development Finance Corporation (DFC), the Inter-American Development Bank, and other financial entities, provided more than $450 million for marine conservation to protect the biodiverse archipelago through 2041.
Sustainable finance and green investments have steadily grown since the adoption of the United Nations 2030 Agenda for Sustainable Development and the 2015 Paris Agreement on Climate Change, with increasing public-private collaboration.
“Renewable-energy infrastructure can require longer financing support behind multilaterals, typically on a semi-concessional basis, provided at below-market interest rates,” noted Tyson. “But the longer timeframe is more affordable and helps re-align low-income nations’ debt profiles to make the burden more manageable.”
