U.K. terrorism reinsurer has $7 billion in coverage for Olympic Games
Pool Re covers terror attack-connected losses for commercial property. Any bombings, bioattacks or incidents that cost more than that amount would be covered by British taxpayers under the Pool Re structure. The structure was put in place in the 1990s when the government had concerns that Irish militant group activities could make property in London uninsurable, Reuters reports.
"We wouldn't normally have interaction with every insurer on every program," Steve Atkins, the chief executive of Pool Re, said, according to Reuters. "But with things like the Olympics we tend to have done that so that if there were anything, we're already informed about what the insurance arrangements are."
The reinsurer was set up in 1993 after a wave of Irish Republican Army bombings occurred in the financial district of London. Pool Re has not altered its premiums in the time leading up to the Olympic Games because a terror attack risk is tough to assess with accuracy.
"We take the view that we've always got to be there and ready to deal with a terrorist event if it occurs no matter how unlikely it was assessed to be before it occurs," Atkins said, according to Reuters.
Pool Re can call on unlimited taxpayer funding in the event of losses equaling more than its assets. The organization has never had to draw on the backstop of the government's funding.