Marsh has partnered with banking giant Citi to develop a risk mitigation structure on behalf of the Gavi Vaccine Alliance to cover the risk associated with governments that are self-funding their COVID-19 vaccine procurement through the World Health Organization’s (WHO) COVAX facility.
The structure will enable the Geneva-based Gavi, a global public-private health partnership which co-leads COVAX with WHO, to pre-purchase vaccines in bulk from manufacturers with greater confidence and facilitate the more rapid and equitable distribution of vaccines globally.
The structure provides cover against the risk of non-payment by 21 countries across Africa, the Americas, Asia, and Continental Europe. Under the terms of the policy the identity of the countries covered, and other aspects of the policy, will not be disclosed.
The policy is underwritten by six leading insurers – namely, AXA XL, Chubb, Liberty Specialty Markets, Sovereign Risk Insurance, Swiss Re Corporate Solutions, and Tokio Marine HCC.
“Striving for greater global vaccine equity by increasing vaccination rates worldwide will not only help countries recover faster from the impact of the pandemic but may also reduce the risk of new variants that come from high levels of community transmission,” said Stephen Kay, political risk leader at Marsh. “This innovative structure will hasten that process by allowing Gavi to procure and distribute vaccines more speedily and with greater financial confidence.”
Assietou Diouf, managing director of finance and operations at Gavi, added: “An initiative like COVAX requires a risk mitigation structure to match its scale, complexity and ambition. This new structure will further strengthen the foundation of COVAX, which is the best mechanism the world has to bring an end to the acute phase of the COVID-19 pandemic.”