The ASEAN Reinsurance Working Committee (ARWC) has signed a Memorandum of Understanding (MOU) to support the establishment of the ASEAN Renewable Energy Pool (AREP), initially conceptualized by Malaysian Re and under the oversight of the ASEAN Insurance Council (AIC). This agreement marks a significant commitment to underwriting capacity and outlines the terms for the creation of AREP.
Malaysian Re served as the chair of ARWC for the 2021-2022 term, during the 4th ARWC meeting on October 15, 2021. The initiative aims to bolster ASEAN governments’ renewable energy policies.
Ahmad Noor Azhari Abdul Manaf, president & CEO of Malaysian Re, highlighted the necessity of such a pool, citing the substantial financial risks associated with renewable energy ventures, particularly in solar and wind energy.
The MOU, signed during the 26th ASEAN Insurance Regulators’ Meeting & 49th ASEAN Insurance Council Meeting, signifies a unified effort by ARWC members to support the ASEAN region’s pursuit of net-zero emissions and effective climate change management.
The collaboration includes key ARWC members such as Malaysian Re (acting as Pool Manager), 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).
“The inherent financial risk associated with these ventures can be potentially overwhelming for one insurance company to manage effectively. 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,” Manaf said.
In other recent developments, latest estimates from Swiss Re revealed that natural catastrophes are projected to set new records in insured losses in 2023.
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