Introduction to Pool Re’s Market Consultation
Pool Re, the UK’s government-supported reinsurer dedicated to terrorism-related risks, has initiated a significant market consultation. This initiative aims to explore the feasibility of integrating terrorism insurance as a default component within commercial property policies targeted at small and medium-sized enterprises (SMEs).
Objective of the Consultation
Running until April 2025, the consultation invites insights from various stakeholders, including Pool Re’s members, re/insurance intermediaries, policyholders, industry associations, and the broader insurance market. The primary objective is to gather diverse perspectives on addressing the current protection gap and alleviating the substantial economic impact caused by the inadequate uptake of terrorism insurance among SMEs.
CEO’s Statement
Tom Clementi, CEO of Pool Re, stated: “Currently, only 4% of SMEs in the UK possess terrorism insurance coverage, and many more might erroneously believe they are covered. Our aim is to narrow these significant protection and expectation gaps, thereby enhancing the resilience of the UK economy by offering our Members a more appealing pricing strategy concerning their SME portfolios.”
Modernizing Reinsurance Schemes
Pool Re is set to introduce a new, modernized reinsurance scheme on April 1, 2025. This scheme is designed to simplify and reduce costs for Members integrating terrorism cover into their SME property policies. Achieving this would restore the market conditions to those prior to Pool Re’s establishment in 1993, a time when terrorism coverage was a standard feature in commercial property insurance packages.
Call for Market Feedback
The consultation seeks widespread input on the most effective strategies to achieve these goals. Pool Re emphasizes the importance of market feedback to ensure that the proposed solutions are practical and beneficial for all stakeholders. Stakeholders are strongly encouraged to share their insights and contribute to shaping a resilient future for the UK economy.
