Broker backs ESG insurance start-up

Parhelion Underwriting Ltd., a U.K.-based energy and climate risk finance company, on Wednesday said it is seeking to raise $500 million to become an insurer focused on sustainable risks, backed by Howden Broking Group Ltd.

Parhelion will begin underwriting from Jan. 1., 2022, and will provide traditional coverage as well as environmental, social and governance-specific coverages, London-based Howden said in a statement.

It will be led by reinsurance and climate risk finance experts Julian Richardson and David V. Cabral as co-CEOs Mr. Richardson founded Parhelion, a climate finance consultancy, in 2006 and prior to that served as insurance and resilience finance specialist at the U.K.’s Department for International Trade. Mr. Cabral previously held a variety of advisory roles and was chief operating officer of Hong Kong-based Peak Reinsurance Co. Ltd. from 2018 to 2020.

Chris Sharp will join as chief underwriting officer from September. Mr. Sharp was previously underwriting director and head of property reinsurance at Dale Underwriting Partners Ltd.

The insurer aims to meet the growing demand from corporates looking for coverage to support their journey towards ESG transition, Howden said.

“Empirical studies evidence a persistently strong correlation between corporates with advanced ESG credentials and low insurance claims,” according to the statement.

Howden is the seed investor in Parhelion. Howden Capital Markets and TigerRisk Capital Markets & Advisory are advisers on the deal.