The Australian Reinsurance Pool Corporation (ARPC) has announced its 2018 retrocession-reinsurance program of $3.065bn plus ARPC's net assets, as well as the $10bn Commonwealth guarantee, providing the scheme with continuing capacity to pay more than $13.4bn in claims.
“ARPC was able to increase private-sector participation in the scheme by lowering the retrocession deductible from $350m to $285m and renewing the remainder of the program within our budget,” said Chris Wallace, ARPC chief executive. “ARPC remains well positioned to protect Australian businesses from economic losses, including property damage and business interruption, in the event of a declared terrorist incident. Our private sector retrocession-reinsurance program provides increased scheme capacity to pay for large terrorism events, and protects the government’s Commonwealth guarantee and Australian taxpayers.”
Australia's terrorism insurance scheme administrator also said it completed more than two-thirds of the program on a multi-year basis, providing all stakeholders with a degree of stability in terms of the level of cover purchase and price paid.
The new retrocession-reinsurance program covers roughly $3.5tn in Australian-based commercial property-sector assets by insured value – an increase from 2017's $3.4tn.
Wallace and Michael Pennell, chief underwriting officer, met with almost 70 reinsurers in key global markets to finalise the program, ARPC said.