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Reinsuring terrorism and cyclones with ARPC

Our vision is to support insurers to deliver affordable terrorism and cyclone insurance in Australia

Terrorism

Since 2003, ARPC has operated a Terrorism Reinsurance Pool (terrorism pool) which provides general insurance companies (ARPC’s insurer customers) with reinsurance for commercial property and associated business interruption losses arising from terrorism.

While the Terrorism and Cyclone Insurance Act 2003 (TCI Act) mandates that insurers provide cover for terrorism, it is voluntary for insurers to purchase terrorism reinsurance from ARPC.

Insurers who enter into a Terrorism Reinsurance Agreement with ARPC, lay off their terrorism liability to ARPC for their eligible insurance contracts which are protected through ARPC’s net assets, global retrocession program, and the Commonwealth guarantee.

The terrorism pool has approximately $13.5 billion in funding (excluding insurance industry retentions) available for claims arising from a Declared Terrorism Incident (DTI) and protects more than 760,000 eligible insured property assets valued at more than $3.9 trillion.

Cyclone

From July 2022, ARPC commenced operating a Cyclone Reinsurance Pool (cyclone pool) for cyclones and cyclone-related flood damage. Participation is mandatory for general insurers with eligible policies. Large general insurers will be required to transfer their portfolio to ARPC by 31 December 2023. Small general insurers i.e., insurers whose total gross written premiums for household insurance are less than $300 million for the financial year before 31 December 2022, will be required to transfer their portfolio to ARPC by 31 December 2024. All insurers can voluntarily join the cyclone pool from 1 July 2022.

Terrorism Pool

The terrorism pool was established in 2003 following the 11 September 2001 terrorist attacks in the United States and the withdrawal of terrorism cover by insurers.

Insurers can reinsure the risk of claims for eligible terrorism losses by entering into a reinsurance agreement with ARPC.

Cyclone Pool

The Australian Government has legislated for a reinsurance pool for cyclones and related flood damage. The cyclone pool is designed to make property insurance more affordable for households and small businesses by reducing the cost of reinsurance, a significant cost component of these policies. ARPC commenced cyclone pool operations in 1 July 2022.

The pool targets support to high and medium risk cyclone-prone areas Australia-wide. ARPC has operated the pool since 1 July 2022.

Client Portal

Terrorism Insurer Portal (RISe)

RISe is ARPC’s terrorism pool insurer customer portal, which allows terrorism pool insurer customers to lodge their company information in a secure and user-friendly environment.

Client Portal

Cyclone Insurer Portal (PACE)

PACE is ARPC’s cyclone pool insurer customer portal, which allows cyclone pool insurer customers to lodge their company information in a secure and user-friendly environment.

Login

Insurer customer logins to ARPC

Terrorism Insurer Portal (RISe)

RISe is ARPC’s Terrorism Reinsurance Pool (terrorism pool) insurer customer portal, which allows terrorism pool insurer customers to lodge their company information in a secure and user-friendly environment.

Cyclone Insurer Portal (PACE)

PACE is ARPC’s Cyclone Reinsurance Pool (cyclone pool) insurer customer portal, which allows cyclone pool insurer customers to lodge their company information in a secure and user-friendly environment.