The PEF was set up in 2016 as an innovative, insurance-based financing mechanism to finance response efforts in IDA-eligible countries to tackle rare, high-severity disease outbreaks, with the aim of preventing such outbreaks from becoming pandemics.
Pandemics are one of the most certain risks the world faces, with enormous costs. A severe pandemic can result in millions of deaths, and even the most conservative estimates suggest that pandemics destroy up to 1% of global GDP, which is comparable to other top-priority threats, such as climate change. It's been estimated that the annual global cost of moderately severe to severe pandemics is roughly USD 570 billion, or 0.7% of global income.
The PEF financial structure includes complementary insurance and cash windows. The insurance window provides, under the inaugural PEF transaction (PEF 1.0) completed in June 2017, coverage over a three-year period against outbreaks of six viruses with pandemic potential. The coverage for the risk transfer window of PEF 1.0 was obtained in both catastrophe bond (USD 320 million) and swap (USD 105 million) form through the intermediation of the World Bank.
In advance of the scheduled maturity of the PEF 1.0 parametric insurance coverage in July 2020, the World Bank, with the help of selected re/insurance brokers ("Structurers"), is reviewing all aspects of the PEF 1.0 structure in order to improve the program, where necessary, for the anticipated commencement of marketing the PEF 2.0 risk transfer mechanism in or about May 2020.
The World Bank is seeking the services of an expert risk modeling firm ("Modeling Agent") to conduct a series of iterative risk modeling exercises and, as needed, build a risk model which will underpin the risk transfer window for PEF 2.0.
Proposals are due by 5:00pm (Washington DC time) on April 26, 2019.
Contact details can be found here: worldbank.org