While working for Swiss Re, a global reinsurer, we investigated the possibility to reinsure yaks in Tibet and undertook a field trip to Lhasa to meet the leading insurer PICC. As we only realised later, it was tough taking an airplane from Chengdu airport in the province of Sichuan (495-meter altitude) and land at Lhasa airport (3,570 m) getting immediately out of breath with the change in altitude. It was surprising to find oxygen bottles in the minibar of the hotel and to discover that barley wine, offered by our hosts, helped to adjust us to the high altitude.

The next day we met our client PICC to discuss reinsurance of yaks, which required a three-way translation from English to Chinese and to Tibetan. Yaks are sturdy animals and are well adapted to harsh winter conditions in high altitude, however, exceptionally cold winters and heavy snowfall can lead to significant mortality due to the inability of the animals to graze. This has caused high mortalities in the past and is like the dzuds that cause high livestock losses during severe winters in Mongolia. PCIC and other insurers have been insuring over 4.6 million yaks for mortality during severe winter conditions. We had the privilege of meeting a herder family (picture) near the Kampa-La pass (4,753 meters) for a cup of butter tea to get first hand experience in the risk management of yaks. This field mission gave us a lot of confidence in reinsuring seminomadic animals in China.