ACE has announced the launch of ACE PFI (Private Finance Initiative), which it describes as a “fully integrated insurance solution providing comprehensive cover and risk management advice for all aspects of a PFI project, from construction through to commissioning, handover and the resultant operational risks.”
The new product “combines the company’s existing expertise in key PFI areas, such as construction, with other key lines including marine and environmental liability,” said the bulletin. It offers “brokers and Project Managers the option of using a single insurance provider.”
ACE said it “believes that the combination of these covers, particularly environmental impairment/pollution and marine, fills current gaps in provision and is of increasing importance to protect both the insured and the broker.
“According to the National Audit Office, as of December 2006, 794 PFI deals had been signed, with a combined capital value of just under £55 billion [$111 billion]. The life of these contracts is typically 25-30 years. In view of the size of these projects and given the government’ s desire to ensure the security of taxpayers’ money, contracts for PFI projects are highly complex and demanding.”
Just as the contracts are complex, so is the coverage required. Alistair Macintyre, ACE’ s UK & Ireland Product Development Manager explained: “PFI contracts often involve very large values and consequently require significant capacity. It is important that both brokers and insurers have an in-depth knowledge of the specific duties imposed on them by PFI contracts and a sound understanding of the construction process and operational risks presented.
“In the past PFI insurance solutions have been heavily focused on construction risks. However, the influence of EU legislation in areas such as environmental liability has a direct impact on those involved in PFI projects.
“With ACE PFI we have harnessed our underwriting experience in construction risks and the PFI sector to develop a holistic solution for a market where, until now, this has been lacking. By having one insurance provider, brokers and clients benefit from a reduction in the likelihood of any gaps in cover, better continuity and service value.
“The PFI market is uniquely challenging in terms of its complexity and scale. ACE PFI is designed to offer a comprehensive and flexible insurance solution which will satisfy the exacting demands of the PFI contract, as well as the needs of the broker, insured and financier.”
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