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A new Lloyd's Syndicate will insure the transportation and storage of COVID-19 vaccines—once they've been developed and approved for use—in emerging market countries. This highly collaborative undertaking harnesses the collective capabilities, expertise and resources of several public, private and non-profit organizations, including AXA XL. Andrew Coutts, AXA XL's Global Head of Cargo, has the details.

Per Thomas Edison's often -repeated assertion, innovation "boils down to one percent inspiration and ninety-nine percent perspiration".

The inspiration in this case came from Ben Hubbard and his team at Parsyl, a company that developed a small, inexpensive device to monitor temperature, humidity, light, impact and location. For cargo owners and insurers, having Parsyl's Trek device accompany shipments of perishable or sensitive items—such as seafood, pharmaceuticals or other perishable foods—has proven enormously beneficial in minimizing product losses and when resolving claims.

Ben previously worked in President Barack Obama's administration as Chief of Staff at the U.S. Agency for International Development (USAID). That background doubtless contributed to his "Aha!" moment—the one percent inspiration here—when he realized Parsyl's technology could help global health organizations deliver more consistently viable vaccines to people in impoverished, remote areas of the world.

Maintaining the cold chain from end-to-end
According to the U.S. Centers for Disease Control and Prevention (CDC):
"Failure to store and handle vaccines properly can reduce vaccine potency, resulting in inadequate immune responses in patients and poor protection against disease. Patients can lose confidence in vaccines and providers if they require revaccination because the vaccines they received may have been compromised".

Thus, it is essential that vaccines be kept within carefully controlled conditions from the time they leave the lab to when they arrive at wherever they are to be administered. And in many cases, that is a long, complicated trip. A typical journey from a production facility in the U.K. to a remote village in Africa, for example, could include several segments in a van or lorry, a long stretch on a ship or plane, and the "last mile" aboard a motorbike. Not to mention stops in at least three storage depots along the way.

Regardless of the precautions taken to safeguard vaccines at each stage, Ministries of Health and frontline health workers have no way of knowing exactly what happened during the journey that may affect their potency, let alone understand how to target operational improvements for better outcomes in the future. And, as the CDC notes, when a vaccine's potency is compromised, not only is the cost and effort involved in delivering it wasted, but the targeted population remains unprotected against that particular disease.

That's where the Parsyl technology comes in. With its Trek device, authorities can easily track vaccines in storage and transit and determine if something happened that could reduce their effectiveness. Although acknowledging that a vaccine has been compromised means delaying an inoculation programme until a new batch can be produced and dispatched, that is a better outcome than administering an ineffective vaccine. These interruptions also serve to expose weak links in the cold chain that can then be rectified in future shipments.

Enter COVID-19
AXA XL and Parsyl started discussing a possible collaboration a couple of years ago. The idea was to combine Parsyl's monitoring technology with insurance policies that would cover the cost of replacing off-spec batches. The aid agencies, foundations and NGOs active in vaccine development and delivery programmes were supportive of this as our partnership would significantly bolster their ongoing efforts to protect vulnerable populations.

Despite the concept being relatively straightforward, myriad implementation issues required attention; thus began the ninety-nine percent perspiration part.

Fast forward to earlier this year. AXA XL, Parsyl and Ascot Underwriting were making good progress validating the idea and developing possible tech solutions and insurance structures; then, suddenly, a new coronavirus emerged, and COVID-19 started spreading around the world. Suffice it to say that creating a viable, sustainable solution for ensuring the safe delivery of an effective COVID-19 vaccine in emerging market countries took on new urgency.

At this point, the fairly small, focussed team working on this initiative quickly recognized the need to collaborate on a massive scale across government ministries, aid agencies, organizations such as Gavi and the Bill and Melinda Gates Foundation, and the insurance sector. In short order, a larger group of collaborators came together to address a complex yet important problem that no single company or organization could solve on its own: creating the structures and processes, and securing the capital, needed to ensure that COVID-19 vaccines administered to people in emerging market countries around the world are delivered with full potency.

A collaborative approach harnessing collective capabilities, expertise and resources
On 23 July 2020, Lloyd's of London announced the launch of a new "syndicate in a box", Syndicate 1796 named as the Global Health Risk Facility (GHRF), to cover the transportation and storage of COVID-19 vaccines (once approved) in emerging market countries. The number 1796 refers to the year Edward Jenner began work on the vaccine that ultimately led to the eradication of smallpox.

Launching an undertaking with such broad scale and scope—and doing so in record time—couldn't have happened without the capabilities, expertise and resources of multiple organizations. An obvious requirement was deep experience in the global cargo insurance market; that's where Lloyd's comes in. Parsyl has established a Managing General Agent (MGA) at Lloyd's, and when an individual country comes on board, the business will be priced in London and flow through Parsyl's MGA. As sponsors of Syndicate 1796, Ascot Underwriting will be the lead insurer with AXA XL acting as a co-insurer alongside other London Market insurers and the GHRF. Parsyl's technology, which is the critical enabler of the scheme, will be used to monitor the status of vaccines as they move from point-to-point; when an out-of-spec reading is registered, that will quickly trigger a claims response, including the development and delivery of a replacement.

At the same time, we need to manage the risk on the ground in each country. AXA XL Risk Consulting will oversee this process, utilising our own engineers and local partners, to ensure that the warehouses, local logistics providers and transport operators are all able to handle, store and distribute vaccines effectively and safely. The AXA Group's international network will be responsible for issuing local policies in the participating countries.

Finally, monetary support is crucial since this initiative aims to cover vaccination programmes in emerging market countries with limited financial resources. Syndicate 1796 currently has secured USD 25 million in public sector capital, and efforts to obtain additional funding are continuing.

Now, all of this has been done before we have a proven vaccine for COVID-19, and there are still many unknowns. We don't know, for instance, where the vaccine will be produced, how much it will cost, what quantities will need to be produced, or if it will be a one-time treatment or something that needs to be repeated. And from an insurance perspective, we have no idea how volatile it will be; that is, what conditions will be required to keep it stable and viable.

Nonetheless, I'm confident the partners in this endeavour will be able to support the safe delivery of an effective COVID-19 vaccine in many emerging market countries. And that this delivery template can be replicated for other vaccines, including those for malaria and other infectious diseases. Finally, I am proud to be part of something where insurance provides significant benefits to the entire global population, and not just to the privileged few in developed western economies.

Andrew Coutts is AXA XL's Global Head of Cargo. In this role, he is responsible for driving underwriting appetite, discipline and profitability across one of the largest international portfolios of cargo insurance. Andrew is based in London and can be contacted at

Parsyl is a technology company that delivers IoT enabled supply chain visibility and insurance solutions for shippers and suppliers of pharmaceuticals, perishable foods and other sensitive goods. Parsyl combines smart sensors, data insights, and comprehensive cargo insurance coverage to improve risk resiliency and safeguard goods in transit and storage. Learn more at


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In the US, the AXA XL insurance companies are: AXA Insurance Company, Catlin Insurance Company, Inc., Greenwich Insurance Company, Indian Harbor Insurance Company, XL Insurance America, Inc., XL Specialty Insurance Company and T.H.E. Insurance Company. In Canada, coverages are underwritten by XL Specialty Insurance Company - Canadian Branch and AXA Insurance Company - Canadian branch. Coverages may also be underwritten by Lloyd’s Syndicate #2003. Coverages underwritten by Lloyd’s Syndicate #2003 are placed on behalf of the member of Syndicate #2003 by Catlin Canada Inc. Lloyd’s ratings are independent of AXA XL.
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