ARPC completes 2025 terrorism retrocession program with smaller limit

Australia’s terrorism reinsurance pool, administered by ARPC, has finalised its retrocession program for the 2025 calendar year with a smaller limit and an increased deductible.

According to ARPC, this adjustment reflects its current view of risk for the portfolio and its assessment of value for money in the risk transfer.

The retrocession, of $2.15 billion, plus ARPC’s net assets and the $10 billion Commonwealth guarantee, reportedly provides approximately $14 billion in pool capacity in response to a declared terrorism incident affecting commercial and other eligible property assets.

As Reinsurance News understands, ARPC’s net assets which fund the $350 million program deductible, plus the approximately $2.15 billion retrocession program, comprise the first levels of funding for claims in response to a declared terrorism incident.

ARPC said it met with more than 40 reinsurers in person or online in key global markets to arrange the 2025 program.

ARPC Chief Executive, Dr Christopher Wallace, commented, “We are pleased to have completed our 2025 retrocession program, which is key to maintaining our strong position in the global terrorism reinsurance market.

“This program enhances our ability to leverage market appetite and lock in cost-effective reinsurance rates through a multi-year agreement.”

“ARPC’s retrocession program includes Australian and international reinsurer participants which together provide terrorism cover for Australian-based property assets.”

“The program allows ARPC to provide protection against terrorism-related risks, while ensuring financial stability and resilience for its cedants.”

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