Totus Re, an open collective to help plan coverage for catastrophic pan-economic events, has warned the UK Government against taking a single peril view to societal risk following the COVID-19 pandemic.
In a new statement, Totus Re expressed support for the UK’s Pandemic Re steering group, but said that current plans do not go far enough.
The collective urged both the UK Government and re/insurance industry to consider the whole range of perils catalogued by the National Risk Register rather than focusing solely on pandemic risk.
“In our rush to treat the symptom we need to make sure we don’t fall into the trap of simply adding a pandemic silo to the government’s ad-hoc architecture of guarantees and backstops in a game of endless whack-a-mole,” Totus Re said.
Instead the collective proposed that it is time for the government and the industry to act boldly and co-create a multi-peril, state-backed reinsurance overarching entity
This kind of public-private arrangement, it argued, would address chronic underinsurance and low resilience against a range of catastrophic perils in the UK, rather than the isolated symptom from which the country is currently reeling.
“Thinking about pandemic risk as part of a broader universe of systemic risks facing society is not to say that Covid-19 does not present urgent and unprecedented challenges,” said Totus Re Co-Founder Liz Foster.
“As such, we are wholly supportive of the ‘Pandemic Re’ steering group established by Stephen Catlin. We are encouraged by the prospect of the industry uniting behind a single proposal to bring to government,” Foster continued.
“Broadly, our aims are complementary: a partnership with the state to enable (re)insurers to viably ensure that the products businesses will need to successfully weather the next national crisis, are available and affordable.”
