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- Report n°3: Financial protection of critical infrastructure
Report n°3: Financial protection of critical infrastructure
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Table of contents
- International analysis of coverage mechanisms : Private-Public Partnerships
- Commercial terrorism insurance in the United Kingdom (Pool Re)
- International analysis of coverage mechanisms : Private-Public Partnerships
Commercial terrorism insurance in the United Kingdom (Pool Re)
The U.K. system was the first private pool for co-reinsurance against terrorism to be created in Europe, long before the events of September 11, 2001. In fact, following the bomb attacks in London in April 1993, British insurers announced their intention to exclude terrorism from commercial policies. Discussions between representatives of the insurance industry and the government led to the creation of Pool Re, which is a pool of insurers (220 members) acting as reinsurers and covered by the government. Coverage by the pool is not mandatory.
Originally, the program was designed to cover against damage to property as a result of politically motivated attacks, in particular those perpetrated by the IRA. The dimensions of the 2001 attacks against the United States had induced insurers and the government to extend terrorist coverage to a larger selection of insurance policies. These changes took effect on January 1, 2003. Coverage by Pool Re now includes protection against chemical and biological attacks, and nuclear contamination. The Pool Re reinsurance premium is calculated on the basis of fire insurance amounts insured. However, unlike the French system (see below), the price of coverage - a percentage of the amounts insured - depend on location of the risk (4 different zones have been defined) within the country, with a maximum premium of 0.06% of amounts insured for central London.