Powering up the insurance proposition.

The electrification of Africa is no longer an issue of whether, but when primary and multilateral insurers will shift into a higher gear to provide insurance that effectively addresses their clients’ financial goals – and create opportunities for energy investments. Insurers are thus now playing a crucial role in shaping this growing market.

Setting political risks aside, offtake insurance products, greater adaptability to project specifics and shorter claims processes are just some of the challenges primary insurers must find ways to meet.

More than a one-stop de-risking solution, a launch pad to new growth.

Rather than proposing yet another insurance product, the African Energy Guarantee Facility (AEGF) provides a platform with added capacity and scope for existing insurance offerings. So that primary insurers can finally deliver the coverage solutions for political and contractual uncertainties that developers, investors, lenders and sovereign stakeholders can rely on.

AEGF´s platform reduces exposure while at the same time expanding the scope of solutions that primary insurers can propose. It is about providing the agility, speed and flexibility to address new needs as existing energy projects evolve and new projects leave the drawing board.

Making risk mitigation work for green energy lending and investment:

The AEGF risk-sharing platform rests on three pillars: Munich Re as the re-insurer, with EIB and KfW providing a 2nd loss guarantee to increase Munich Re’s reinsurance capacity. This extra capacity is made available to primary insurers so they can offer lenders and investors AEGF-backed solutions to better address the risks and timelines of green energy projects. The ability to purchase better-adapted and and more cost-effective coverage then gives both lenders and investors the incentive – and the peace of mind – to finance green energy development.
The African Energy Guarantee Facility backs primary insurers with a total re-insurance capacity of 1 billion USD.