IAG’s venture capital arm is partnering with two Israeli firms to back start-ups that can help the insurance group grapple with costly climate risk.
As the industry attempts to mitigate the cost of a changing climate and more frequent natural disasters on their businesses, the IAG Firemark Ventures partnership with Jerusalem Venture Partners and incubator Margalit Startup City is expected to make its first investment this year.
In particular, the venture capital fund is expected to focus on AI prediction and analytics technology as insurers attempt to better map climate risk where extreme weather events, like hurricanes, floods and wildfires, become more frequent and lead to more property damage.
Natural disasters like the deadly flooding in New Zealand and last year’s Queensland floods have challenged insurers as they respond to thousands of claims and rising reinsurance premiums. Insurers take out reinsurance generally to protect them and their bottom line in case of big disasters.
IAG Firemark Ventures partner Scott Gunther said talks about putting more resources towards climate-related investments started late last year after meeting the founder of JVP and Margalit, Erel Margalit, in Israel.
With the partnership now active, Mr Gunther told The Australian Financial Review that IAG would look to make its first investment stemming from the partnership with the next six months.
Read the article by Lucas Baird in the Financial Review.