UK terrorism reinsurance backstop expands cover
Posted On: Mar. 3, 2017 11:33 AM CST
Pool Reinsurance Co. Ltd., the U.K. government-backed terrorism reinsurance backstop, said on Friday it has increased its commercial reinsurance cover to £2 billion ($2.49 billion), compared with the £1.95 billion ($2.43 billion) previously in place.
The increase provides additional protection to the U.K. Treasury, U.K. taxpayers and the program’s assets, the mutual insurer said in a statement.
The two-layer program was brokered by Guy Carpenter & Co. L.L.C. and placed with a panel of reinsurers, including Pool Re members and global reinsurers led by Munich Reinsurance Co., and mirrors the cover currently provided to Pool Re members, according to the statement. It includes chemical, biological, radioactive and nuclear terrorism risk.
“This increased retrocession limit is not only evidence of Pool Re’s strategy to protect its stakeholders, but also to allow the market to write as much U.K. terrorism risk as they are able,” Steve Coates, London-based chief underwriting officer at Pool Re, said in the statement. “We will continue to extend our protection in the future, within the boundaries of cost and counter-party security.”
Pool Re was set up in 1993 by the U.K. government and insurance industry, and its members include most insurers and Lloyd’s of London syndicates that offer commercial property insurance in the United Kingdom. In 2015, the mutual insurer implemented a series of changes to modernize the pool.