Designed specifically to tackle the cost of living crisis with an unprecedented raw materials price risk insurance solution for companies, this game-changing innovation creates:
Exceptional breadth of cover – price risk insurance for a wide range of materials used in manufacturing including those where price risk protection through hedging is not viable . Enabling:
The world’s first recycled materials price risk insurance – currently unavailable this has, to-date, hampered adoption of the “circular economy.”
Accessibility: Simply arranged cover from raw materials price risk for firms of all sizes that previously was only available to the most sophisticated organisations through complex hedging strategies – transforming the input cost risk profile for businesses
31st March 2025, ChAI, the AI-driven commodity intelligence company, announces the launch of ChAI Protect to provide insurance to companies of all sizes against pricing risk at a time of unprecedented volatility in raw materials markets. ChAI Protect is already utilised by large publicly traded firms and is underwritten by tier one, A-rated, underwriters.
Corporate purchasing teams increasingly have to navigate unparalleled price moves in a wide range of essential commodities. From cocoa to copper, “black swan” pricing events have seemingly become the new normal. Whether companies are manufacturing cars or chocolate bars, executing purchasing strategies that protect margin and minimise supply chain pricing risk has never been harder. For all companies, delivering growth in the current environment of increasing raw material price volatility is more challenging; and for smaller companies making the wrong purchasing decisions can have existential consequences.
Designed with support from some of the world’s largest FMCG, pharma, automotive and food production companies, ChAI Protect enables companies around the world – from SMEs to Fortune 500s – to protect their growth by covering themselves from cost-based uncertainties. This innovative price risk insurance will be of most value for raw materials where hedging is currently not possible, as no accessible derivatives markets exist.
How does it work?
ChAI’s AI-driven commodities market forecasting assesses thousands of data points every day creating actionable, accessible, insights that are bespoke to corporate purchasers, creating an understanding of the probability of any price being hit over a 12 month period. These insights allow ChAI to effectively price insurance premiums for price indices matching any conceivable contractual obligations with suppliers, simulate underwriting portfolios and enable the ability to offer premiums that reflect the true risk of a price being hit.
Commenting on the launch Tristan Fletcher, CEO and co-founder of ChAI, stated: “At a time of unprecedented commodity pricing volatility, cost-base uncertainty can be existential for businesses. So we are delighted to support smaller companies as well as larger corporates with this innovative AI driven insurance product, creating pricing mitigations that were previously only available to multinationals and speculators through hedging strategies.”
“We are proud that ChAI Protect gives companies the ability to insure themselves in this way for the first time. In particular, for recycling materials – where it is currently almost impossible to offset price risk, we are delighted to offer a solution that addresses one of the key reasons these materials are not more widely used.”
Richard Chattock, CEO of Insurtech Gateway said: “Industrial supply chains face increasing price volatility in commodities with the majority unable to access hedging tools. ChAI’s new insurance product solves this problem. We were really impressed by ChAI’s deep data insights into market and pricing dynamics, and are looking forward to supporting them as they scale this new product.”
ChAI is backed by venture capital fund Seraphim Space with participation from Insurtech Gateway, Passion Capital, Primo Space, 2050Cap, MMC, Dynamo and Portfolio Ventures.
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