A state-backed British reinsurer that covers terrorism-related property losses is providing $7.3 billion in insurance protection for the Olympic Games in London this summer, according to Reuters.
Pool Re, set up in 1993 after bombings by the Irish Republican Army in the financial district of London, will cover only commercial real estate in any possible terrorism incidents. The reinsurer’s customers include all major property insurers operating in Britain and can draw on unlimited funding from the government for bigger losses. Pool Re cedes 10% of its premiums to the government, but has not yet had to rely on the government for claims money.
The British government currently puts the risk of a terrorist attack as “substantial,” two levels below the highest “critical” level in the five-tier threat assessment system. Pool Re Chief executive Steve Atkins told Reuters that the risk of a terror attack “is very difficult to assess with any degree of accuracy.”