Introduction to Pool Re’s Expanded Retrocession Programme
Britain’s government-backed terrorism reinsurer, Pool Re, has successfully completed the placement of a significantly expanded retrocession programme. Over 60 international reinsurers are involved, providing Pool Re with an impressive £2.75 billion of aggregate excess of loss cover, an increase from the previous £2.4 billion.
Scope and Coverage Details
This enhanced programme offers comprehensive reinsurance for property damage resulting from acts of terrorism, as certified by the UK Government. It includes coverage for both conventional and nuclear, biological, chemical, and radiological attacks. Additionally, there is a limited cyber extension, ensuring a broad spectrum of risks is addressed.
Strategic Goals and Market Impact
Pool Re aims to shift more financial risk from terrorism away from UK taxpayers to the private market, ensuring that terrorism insurance remains both accessible and affordable for businesses across the nation. This development follows Pool Re’s February announcement, highlighting the increased demand for private market retrocession coverage compared to previous years.
Key Partnerships and Broker Involvement
The placement saw significant contributions from key players like Hannover Re and The Fidelis Partnership, who provided valuable pricing guidance. The programme was brokered by Guy Carpenter, a respected name in the field.
Comments from Pool Re and Guy Carpenter Executives
Jonathan Gray, Pool Re’s Chief Underwriting Officer, expressed satisfaction with the strong support from reinsurers, noting that many existing markets have increased their capacity, and several new partners have been added to their panel. He stated, “This increased participation reflects confidence in our approach and enhances our ability to manage risk effectively. We also value our continued collaboration with Guy Carpenter in securing this deal.”
Tom Clementi, Pool Re’s CEO, emphasized that the expanded programme aligns perfectly with Pool Re’s strategic focus on transferring UK terrorism risk to the market, thereby reducing the taxpayer’s exposure to potential losses. He remarked, “This remains a key pillar of our strategy, and we are delighted with this successful outcome.”
Paul Moody, CEO of Guy Carpenter UK, added, “Guy Carpenter is proud to have secured another successful renewal for Pool Re, supporting them with their mandate to return more terrorism risk to the private market. Obtaining £2.75 billion of capacity is a significant milestone, and we thank all of Pool Re’s reinsurers for their support.”
