The Australian Reinsurance Pool Corporation (ARPC), which administers the country’s terrorism insurance scheme, has renewed its $3.5 billion retrocession program for 2023 at the same price as 2022.
The retrocession, which totals around $3.5 billion, in addition to ARPC’s net assets and the $10 billion Commonwealth guarantee, provides over $14 billion in pool capacity in response to a declared terrorism incident affecting commercial and other eligible property assets.
Dr Christopher Wallace, ARPC CEO, commented, “ARPC was able to lock in cost-effective reinsurance rates through a multi-year agreement negotiated in 2022. This provides value for money cover at a time when catastrophe reinsurance rates are rising on global markets.
“ARPC’s retrocession program includes Australian and international reinsurer participants which together provide terrorism cover for Australian-based property assets.”
The Corporation’s net assets, which fund the $225 million program deductible, plus the roughly $3.5 billion retrocession program, comprise the first levels of funding for claims in response to a declared terrorism incident.
DR Wallace continued, “ARPC’s terrorism pool boosts private market participation, supports national resilience and reduces potential losses arising from a catastrophic terrorism incident.”
According to the ARPC, Michael Pennell PSM, ARPC’s Chief Underwriting Officer, met with more than 50 reinsurers in person or online in key global markets to arrange the 2023 program.
In other ARPC news, the Corporation recently announced that Allianz Australia Insurance Ltd joined the Cyclone Reinsurance Pool as an insurer customer.
According to the announcement, the insurer joined the cyclone pool for their Home Insurance business including Buildings, Contents, Landlord Buildings, Landlord Contents, and the private dwelling of Farm Pack business.