“Ground-breaking” financial hedge covers hurricane risks
Willis claimed it had closed a “ground-breaking index-based hedge” for US electric generation and retail electricity provider NRG Energy.
“The transaction is designed to offset the potential financial impact to NRG if a hurricane were to affect its business in the Houston area. This innovative risk management vehicle, known as Willis Hurricane Load-Protection, allowed NRG to lower hurricane risk hedging costs by embedding two additional energy variables into the payout formula. Any payout would not require a prolonged claims handling process,” Willis said.
“NRG and Willis partnered to access an unusually wide spectrum of markets: insurance, re-insurance, retrocession, banking, hedge funds and OTC derivatives. The deal term is through October 2009. Other key terms and conditions of the transaction are considered confidential.”
Hosted by comedian and actor Tom Allen, 34 Gold, 23 Silver and 22 Bronze awards were handed out across an amazing 34 categories recognising brilliance and innovation right across the breadth of UK general insurance.
