Pool Re announced it has renewed the reinsurance cover purchased in 2015, for a further three years. The renewed cover, which now includes an additional layer, provides £1.95 billion ($2.8 billion) of commercial reinsurance compared with £1.8 billion ($2.6 billion) previously.
The placement further distances the UK government and taxpayer from any potential liability, but importantly, also protects scheme assets, thereby increasing the sustainability of the pool, Pool Re said.
The two-layer program, placed with a highly secure panel of reinsurers (which includes global re-insurers as well as its members) led by Munich Re and brokered by Guy Carpenter, mirrors the cover currently provided to Pool Re members, including chemical, biological, radioactive and nuclear risks.
“I’m pleased to announce that Pool Re has bought an additional layer of reinsurance from the commercial market, above the cover that incepted last March,” said Steve Coates, chief underwriting officer of Pool Re.
“This is an important step which reflects an increasing appetite in the reinsurance market for UK terrorism risk and brings us closer to our continued goal of re-engaging global capacity in the provision of terrorism cover in Great Britain. It also further diminishes the UK Government’s exposure and distances the UK taxpayers from any potential liability,” he added.
“We will continue to examine ways to secure more capacity from insurers and reinsurers, so as to increase the scheme’s resilience and to ensure that Pool Re only provides capacity that the market is unable to.”
About Pool Re
Pool Re was launched in 1993 by the insurance industry in cooperation with the UK Government in the wake of the IRA bombing campaign on the UK mainland. A mutual reinsurer owned by its members, Pool Re is underpinned by the UK government, which will support Pool Re if it has insufficient funds to pay a legitimate claim. Pool Re pays a premium to the government for this guarantee and would repay the money over time if it ever used this facility.
Source: Pool Re