The Monetary Authority of Singapore's (MAS) proposed Protected Cell Company (PCC) framework will give Singapore a structure which can better accommodate specific public sector needs, according to the CEO and Executive Director of SEADRIF, Mr Benedikt Signer. The framework will lower the cost and time of setting up new risk transfer arrangements, which means more room to explore new programmes.
SEADRIF (Southeast Asia Disaster Risk Insurance Facility) is a regional platform that builds ASEAN’s financial resilience against climate shocks and disasters.
Mr Signer gave his views on the proposed PCC framework from SEADRIF's perspective as a public sector risk pool. The new framework is expected to be implemented in 2028 and will be available for several insurance use cases to start. These cases are sovereign risk pools, captive insurance and insurance-linked securities.
Mr Signer points out that sovereign risk pools operate differently from commercial insurers. He said, “Governments have different risk appetites, different funding sources, and different reasons for pooling risk. Currently, accommodating that difference requires exploring bespoke legal entities.
“The PCC structure lets that variation sit inside one entity instead, giving us the flexibility to co-design fit-for-purpose solutions more efficiently.
“This lets us build programmes for counterparts with different risk appetite and retention expectations, and to draw on different capital sources, bilateral, multilateral, and dedicated climate funds, within the same platform. It gives us the tool to build a more efficient blended finance structure for insurance: limited concessional capital, ring fenced to a funder’s specific requirements and preferred focus area mobilizing private risk capital alongside it in a segregated cell. This becomes cost-efficient and purpose-built without needing a new legal structure each time.
“This directly addresses a bottleneck in SEADRIF's medium-term plans. We're developing programmes for public infrastructure risk and regional agriculture insurance. Under this framework, each can sit as its own cell, with its own funding sources and governance arrangements, rather than requiring a new SPV or separate company. That means faster scale-up, and it means different donors and funders can back specific programmes with their capital properly ring-fenced, not commingled with others.”
Mr Signer added, “Ultimately, I believe this will contribute to a deeper insurance market in Singapore, serving the whole region. Putting in place the appropriate tools to build customised sovereign risk structures helps us connect public need efficiently with private risk capital and expertise.”