UK-based risk capital and reinsurance broking company Augment Risk has launched a new Global Parametric Speciality division.

Augment said its parametric solutions are designed to improve the conventional client operating model through its claims recovery process.

The new entity aims to facilitate and deliver bespoke index-based risk transfer strategies for clients around the world.

Concurrently, the company hired Kurt Cripps to lead the newly formed division. 

Before joining Augment, Cripps worked for Aon Reinsurance Solutions as the managing director and global head of weather.

The new unit will initially focus on catering to captives, insurers, reinsurers and insurance-linked securities (ILS) companies to manage their exposures to risks such as windstorms, earthquakes and wildfires.

Cripps said: “Fundamentally with reinsurance costs rising, higher deductibles, reduced limits and self-insured retention increasing, clients are having to manage a far greater degree of risk. 

“Parametric coverage has never been a more viable and affordable alternative, whilst also providing clients the comfort that risks are managed in the most efficient and cost-effective way.

“By improving reinsurance purchasing efficiency in this way, we can remove threats associated with loss creep, secondary perils, extensive settlement periods, fraud, and in worst case scenarios, arbitration/litigation so often seen in the traditional market.”

Augment launched operations in July this year with $100m (£81.99m) in investment from private equity firm Altamont Capital Partners.

Later that month, the company appointed Charlie Love as the new CFO and Henry Mikrut as the head of its new rating agency.