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Citi and insurance broker Marsh have announced a risk mitigation structure to help facilitate the shipment of Covid-19 vaccines to 21 countries through the Covax initiative.

Marsh says the structure will allow Gavi, the global vaccine alliance which jointly manages Covax, to pre-purchase vaccines in bulk and protect against non-payment by the recipient countries in Africa, the Americas, Asia, and Europe, whose governments are self-funding their vaccine purchases.

“This innovative structure will hasten that process by allowing Gavi to procure and distribute vaccines more speedily and with greater financial confidence,” says Stephen Kay, Marsh’s political risk leader.

AXA XL, Chubb, Liberty Specialty Markets, Sovereign Risk Insurance, Swiss Re Corporate Solutions and Tokio Marine HCC are underwriting the policy.

The broker says the countries and further details of the structure cannot be disclosed due to the terms of the policy.

“An initiative like Covax requires a risk mitigation structure to match its scale, complexity and ambition,” says Assietou Diouf, Gavi’s managing director of finance and operations. “This new structure will further strengthen the foundation of Covax, which is the best mechanism the world has to bring an end to the acute phase of the Covid-19 pandemic.”

Founded in 2000, Gavi helps finance the supply of vaccines to developing countries who otherwise struggle to afford them. It runs Covax alongside the Coalition for Epidemic Preparedness Innovations and the World Health Organization.

The initiative has so far delivered 206 million doses but has conceded it will not meet its original goal of shipping 2 billion doses by the end of this year.

Many developing countries have been outmuscled by wealthy nations in the scramble to secure vaccine supplies. For example, just 1.73% of Africa’s total population has received two doses of a Covid-19 vaccine, according to August 11 data from the Africa Centre for Disease Control and Prevention.

Gavi appointed Citi as its financial advisor for the Covax facility, the initiative’s procurement mechanism, in November last year.

“We are proud to have worked with Gavi, Marsh and the world’s leading insurance companies to design and implement this risk mitigation strategy for the Covax facility,” says Jay Collins, the bank’s vice chairman, banking, capital markets and advisory.

“The structure allows Covax to accelerate further vaccine purchase agreements for the world. This public private partnership is a further example of the innovative steps the Covax facility is taking to achieve its mission.”

Collins told Bloomberg TV in July that the bank has a dedicated 27-member team working on securing funding for Covax, which he said is run “like a war room”.

“We have had to mitigate the risk by Gavi, a nonprofit that is taking large scale risk in the distribution and the commitment to purchase vaccines. That has required creativity and a lot of innovation by the team every day.”

In April another insurance broker, Aon, announced a global consortium of insurers and tech firms who agreed to use sensor data for more easily managing insurance claims when Covid-19 vaccine doses fall outside the necessary temperature range during transportation and need to be discarded.