U.S. RE ApS, the European subsidiary of U.S. RE Corporation, international reinsurance brokers, has been selected by Finanstilsynet, the Danish financial Supervisory Authority, to conduct a study of terrorism risk reinsurance capacity in the Danish market, Mark Lucas, Managing Director, announced.
“We’re especially pleased to work with the Danish government to determine the private market capacity to reinsure terrorism risk,” stated Tal P. Piccione, Chairman/CEO of U.S. RE Companies, Inc., parent of U.S. RE Corporation. He pointed out that U.S.RE was retained by the U.S. Treasury Department as a consultant in connection with the Terrorism Risk Reinsurance Program that went into effect in 2002 to protect against acts of terrorism in the United States.
The bulletin explained that “reinsurers operating in the Danish market are being asked to report the amount of reinsurance capacity they would be willing to commit to the Terrorism Insurance Pool for property insurance covering nuclear, biological, chemical, and radioactive risks to buildings, contents, railroad vehicles, motor and marine hull in Denmark along with loss of profit.”
Lucas stated that participating companies will have access to a State reinsurance guarantee limited to DKK 15 billion [$2.7 billion] annually on a stop loss basis. “The amount, in excess of which the guarantee attaches, is determined annually by the Ministry of Economic and Business Affairs based on recommendations of the Terrorism Insurance Council.
“This amount will be determined as the point at which the international reinsurance market can no longer provide sufficient reinsurance capacity to cover the NBCR risks,” he explained in a letter to reinsurers. The Terrorism Insurance Pool will pay an annual risk premium to the Danish State for having the guarantee available.
Findings of the study are due to Finanstilsynet by October 1, this year. Lucas requested estimates of capacity available from individual companies by September 28.
Source: U.S. RE
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