Flood Re has successfully secured a £2.1 billion multi-year reinsurance programme.
In an oversubscribed second phase of the tender process, Flood Re successfully bound the additional capacity required to complete the placement.
The three-year reinsurance programme is one of the five largest natural peril reinsurance deals struck globally and the second biggest in Europe, according to Flood Re.
The second phase saw 45 entities offer capacity to meet the required amount to complete the programme, with 38 of those parties securing a share of the placement.
During the first phase, which concluded in late 2015, some reinsurers collectively offered almost £1.29 billion of multi-year coverage, with Munich Re and Swiss Re contributing significant support.
Brendan McCafferty, CEO of Flood Re, commented: “Securing £2.1 billion in annual protection is an important milestone towards Flood Re being ready to accept policies for flood risk households.”
“Although the reinsurance process has now been completed on time and ahead of planned budget, there is still a lot of work to be done. We are testing our systems with insurers to ensure they work effectively and will also continue to work closely with the financial regulators to obtain the authorisation we need to operate.”
The programme is a first in the UK for reinsurance cover under European Public Procurement regulations. It was conducted with the assistance of reinsurance broker Guy Carpenter.
Charles Whitmore, head of property solutions group at Guy Carpenter, added: “The reinsurance market has proved incredibly supportive of Flood Re from the outset, acknowledging both the opportunity and the level of professionalism running through the whole process. As a result the final placement was relatively straightforward with the world’s largest reinsurers providing the majority of the capacity.”
