Pool Reinsurance Co. Ltd. will no longer offer reinsurance coverage to members for the contingency cover against acts of terrorism that they provide to their insureds.
The company said there is sufficient capacity within the commercial insurance and reinsurance markets to cover contingency losses from terrorist activities. The company will cease providing the service after the first quarter, after which member insurers will no longer have the option to cede this class of business to the state-backed terrorism reinsurer. Most of the risks ceded to the company involved sporting events, concerts and tours.
Pool Re started writing the class of business after London was awarded the 2012 Olympic Games and the commercial market concluded that it could not provide cover due to lack of capacity. However, the contingency market recently asked that it be allowed to once more retain such risks for its own account, and not reinsure them to Pool Re.