Building Capacity for the World’s Mega-Projects: A Multilateral Perspective on Specialty Reinsurance

As the specialty insurance and reinsurance markets take stock of another underwriting cycle, the conversations that matter most will, as ever, turn on capacity, pricing and appetite. Yet beneath these perennial questions lies a deeper one: how does the global reinsurance market extend meaningful capacity to the infrastructure, energy and trade corridors that will define economic growth over the next decade, particularly across emerging and frontier markets where risk perception often outpaces risk reality?

This is where multilateral credit and political risk insurers have an increasingly important role to play, not as competitors to the specialty and reinsurance markets, but as partners that widen the pool of insurable risk and bring underwriting discipline, on-the-ground intelligence and long-standing relationships with sovereigns and financial institutions across some of the world’s most complex jurisdictions.

The Islamic Corporation for the Insurance of Investment and Export Credit (ICIEC), a Shariah-compliant multilateral credit and political risk insurer and member of the Islamic Development Bank (IsDB) Group, has spent three decades building precisely this kind of bridge. Established in 1994 and now serving 51 Member States, ICIEC closed 2025 having insured USD 17.8 billion in business, a 37.8 percent increase on the previous year, bringing cumulative business insured since inception to USD 138.9 billion, split between USD 107.8 billion in trade and USD 31.1 billion in investment across Asia, Africa, Europe, the Americas and Oceania. Behind these figures sits a simple proposition: risk that is properly assessed, priced and shared becomes risk that banks, export credit agencies, reinsurers and institutional investors are willing to underwrite.

Reinsurance as a core discipline, not an afterthought

ICIEC’s mandate has always included reinsurance, co-insurance and fronting arrangements alongside its direct credit and political risk insurance business, and this segment has taken on growing importance as Member States’ export credit agencies and national insurers seek to build their own underwriting capacity. Rather than displacing local or regional insurers, ICIEC typically works alongside them, providing treaty and facultative capacity that allows younger agencies to take larger and more complex risks than their balance sheets would otherwise carry, while the local agency retains the relationship with the underlying obligor. The scale of this activity grew markedly in 2025: outward reinsurance reached USD 13.6 billion, a 54 percent increase on 2024, ceding roughly 77 percent of insured business to 20 reinsurance partners, up from 17 the year before, while net retained exposure was held to a disciplined USD 1.6 billion.

This model matters for the specialty market for a simple reason: it expands the universe of insurable transactions before they ever reach a broker’s desk in London, Zurich or Singapore. A reinsurance treaty with a Member State export credit agency, or a co-insurance arrangement on a large infrastructure risk, effectively pre-underwrites and de-risks a transaction, making it more understandable and more attractive when it is eventually placed into the wider reinsurance market. In this sense, ICIEC’s reinsurance activity functions as a feeder mechanism for global specialty capacity, not a substitute for it.

It also gives international reinsurers a form of comfort that is difficult to replicate through desk research alone. Because ICIEC underwrites alongside Member State agencies over many years, it accumulates claims history, obligor behaviour and sector-specific loss data across jurisdictions that would otherwise be opaque to underwriters based in Europe or North America. Sharing that experience, formally through treaty arrangements and informally through the ongoing dialogue multilateral insurers maintain with their specialty and reinsurance partners, helps close the information gap that so often keeps capacity away from markets that are, in practice, creditworthy.

That engagement is becoming more structured. In October 2025, ICIEC convened international reinsurers in London for a workshop dedicated specifically to sovereign Sukuk insurance, working through the credit enhancement mechanics, documentation standards and rating considerations that would need to be in place before reinsurance capacity could stand behind insured Sukuk transactions. Sessions of this kind, where a multilateral insurer sits down with the market that ultimately absorbs much of its risk to design a new asset class together, are a useful indicator of where the relationship between multilateral credit insurance and specialty reinsurance is heading.

Credit insurance and the mega-project agenda

Nowhere is this more visible than in mega-project and infrastructure finance, where credit insurance has moved from a peripheral consideration to a structuring necessity. Large-scale transport, energy and industrial projects across Africa, Central Asia and the Middle East increasingly depend on a layered risk architecture, in which export credit insurance and political risk cover sit alongside commercial bank debt, development finance and, ultimately, reinsurance capacity.

ICIEC’s recent engagement illustrates the pattern at scale. Two Murabaha financing facilities totalling USD 1,266 million, arranged by Deutsche Bank and First Abu Dhabi Bank and backed by up to 95 percent political risk cover from ICIEC, are supporting early construction of Nigeria’s roughly 700-kilometre Lagos-Calabar Coastal Highway. In Türkiye, a EUR 230 million Non-Honouring of Sovereign Financial Obligations cover underpins financing for the 118-kilometre Antalya-Alanya Motorway, a project expected to generate an estimated EUR 6.8 billion in economic activity and around 9,300 jobs over the life of its build-operate-transfer concession. And in Iraq, a EUR 99 million reinsurance placement, ICIEC’s first sovereign transaction in the country, is supporting three high-voltage substations, adding 4,500 megavolt-amperes of transformation capacity for a population of roughly four million. In each case, credit insurance enables commercial lenders to extend financing into markets and sectors they might otherwise consider too exposed to sovereign, transfer or performance risk. By absorbing a share of that exposure and standing behind the credit, ICIEC helps convert a project that exists only on paper into one that a syndicate of banks, and ultimately reinsurers, can price with confidence.

The lesson for the specialty insurance market is that mega-project risks in emerging economies should not be viewed simply as a choice between accepting or rejecting them. Instead, these risks can often be managed through the right structure, with multilateral insurers playing an important role from the early stages of the project.

Specialty lines and the energy transition

Energy remains the clearest illustration of where this partnership between multilateral credit insurance and specialty reinsurance is deepening, and it is by some distance ICIEC’s largest sector, accounting for USD 10.1 billion of the USD 17.8 billion insured in 2025 and USD 57.8 billion in cumulative trade and investment since 2015. As Member States pursue both continued oil and gas development and an accelerating build-out of renewable generation, ICIEC has extended cover across the spectrum, from upstream and midstream financing through to solar, wind and transmission infrastructure. A USD 150 million Murabaha facility supporting Pakistan’s imports of crude oil, refined products and liquefied natural gas, arranged with two prominent financial institutions in the MENA region, one from Kuwait and the other from the UAE, respectively, illustrates how this cover extends beyond project finance into the trade flows that keep national energy systems running day to day. Each exposure carries its own risk profile, from construction and completion risk through to Non-Honouring of Sovereign Obligations, and each increasingly calls for the kind of layered capacity that only a combination of multilateral insurance and specialty reinsurance markets can supply.

Beyond energy, ICIEC’s activity spans other sophisticated lines that will be familiar to specialty market practitioners: political risk insurance for cross-border loans and equity investments, Non-Honouring of Sovereign Financial Obligations cover, structured trade and commodity finance, and letters of credit confirmation business for banks operating in frontier markets. These are lines where underwriting expertise, local knowledge and a disciplined appetite for calculated risk matter more than volume and where ICIEC’s three decades of claims experience and sovereign relationships across its Member States offer genuine underwriting value to reinsurance partners assessing comparable exposures.

Why this matters now

Global reinsurance capacity has hardened and softened in cycles over the past decade, but underlying demand for infrastructure, energy and trade finance across Africa, Asia and the wider Islamic world has continued to grow. ICIEC’s 2025 results point to an expanding pipeline of transactions that will, in time, seek reinsurance capacity of their own: new insurance commitments reached USD 7.3 billion, a 38 percent increase on 2024, with Foreign-Investment Insurance accounting for 65 percent of that total as ICIEC’s business mix shifts toward longer-tenor, investment-led exposures. Since inception, ICIEC has insured USD 138.9 billion in trade and investment across its Member States, with Asia now having the largest regional share at USD 68.4 billion, followed by Africa at USD 44.0 billion and Europe at USD 20.5 billion.

As ICIEC enters its 2026-2030 Corporate Strategy, following the conclusion of its previous ten-year framework, deepening these reinsurance and co-insurance partnerships is a deliberate priority, not an incidental one. This means more structured dialogue with specialty underwriters on emerging risk classes, from climate-linked infrastructure to supply chain and critical minerals financing, and a continued willingness to take a first loss or anchor position on transactions that later attract broader syndication. The Corporation’s Shariah-compliant structure, its Aa3 rating from Moody’s and AA- rating from S&P Global, both reaffirmed with stable outlooks, and its position within the wider Islamic Development Bank Group give it a distinctive standing from which to originate and structure risk in markets where global reinsurers are seeking better visibility and more dependable partners.

For a specialty and reinsurance industry weighing where the next cycle of capacity should flow, multilateral credit insurers such as ICIEC offer more than additional limits. They offer origination discipline, sovereign access and a demonstrated ability to bring previously uninsurable risk into a form the specialty and reinsurance markets can confidently underwrite. That, ultimately, is the proposition worth putting to reinsurance partners in the years ahead.