BlueOrchard managed InsuResilience Investment Fund invests in Cambodia’s largest insurance firm
The InsuResilience Investment Fund (“IIF” or the “Fund”) managed by leading impact investment manager BlueOrchard Finance Ltd (“BlueOrchard”) will acquire a minority stake in Forte Insurance Group (“Forte”), a general, life and micro-insurance group in Southeast Asia. IIF is set up on behalf of the German government by KfW. With the recent investment in Forte, the Fund is fully deployed.
Forte is the only agriculture insurer in Cambodia and the clear market leader in the segment. At the beginning of 2021, Forte launched a pilot in Weather Index Crop Insurance (WICI) with the Cambodian Ministry of Economy and Finance and Asian Development Bank with the aim to reach over 1.8 million farmers by 2026. Cambodia has been heavily impacted by climate events over the last 20 years. 10 million poor and vulnerable people in Cambodia are dependent on agriculture, a sector which accounts for approx. one third of the country’s GDP.
“Agriculture insurance is an effective risk mitigation tool to protect small scale farmers from severe losses caused by natural disasters. We are excited to partner with the market leader to drive the penetration of agriculture insurance products in Cambodia and enhance the adaptation of people with low and middle income to climate change,” said Thibaud Ponchon, Investment Director Asia at BlueOrchard.
IIF will appoint a nominee to Forte’s Board of Directors. The proceeds of the investment will be used to further support the expansion of Forte’s agriculture insurance offering in the Mekong area, hereby extending the firm’s outreach to farmers with low income as well as its insurtech initiatives and to increase the firm’s risk capital.
“We look forward to working with BlueOrchard’s team and leverage their experience in the global insurance sector to develop the regional market together. Forte is dedicated to becoming the pioneer in Cambodia’s agriculture insurance and achieve a larger outreach while building confidence in our clients and international partners. Over the years we have been following the successful investments of BlueOrchard managed funds in the microfinance sector in the region. We are confident that the partnership with BlueOrchard and IIF is ideal for a successful journey and that together we can extend such success into the insurance sector for the rural population in Southeast Asia,” says Charles Cheo, Executive Chairman and Co-Founder of Forte.
The investment in Forte aligns with the vision and principles of IIF and the InsuResilience Global Partnership (“the Partnership”), which was launched at the 2017 UN Climate Conference COP23 by Germany. The vision of the Partnership is to strengthen the resilience of developing countries to the effects of climate change and to protect the livelihoods of poor and vulnerable people against extreme weather events and natural disasters. The Partnership's objective is to enable more timely and reliable post-disaster response and offer insurance solutions to reduce impacts and help poor and vulnerable people recover more quickly.