In 2021, the potential outcome looked gloomy for the mutual and, by extension, the 90+ percent of UK property insurers who make up Pool Re’s membership. The review was dragging on way beyond its original timetable and HM Treasury (HMT) appeared preoccupied with imposing greater controls as part of Pool Re’s public sector classification, as well as exploring a cap on the unlimited guarantee. Indeed, a failed attempt by some members to extract £1bn from Pool Re funds in 2020 to pay for Covid-related claims did little to improve relations between the industry and government, although they have clearly improved since then.
But then signs of much greater progress began to emerge earlier this year, leading to the conclusions outlined in a 24 February letter signed by Charles Roxburgh*, the second permanent secretary to the Treasury.
The Insurer looks at the outcomes and by comparing it to Pool Re’s initial negotiating stance (as outlined in its 2020 white paper), we rate each of the decisions as a win, lose or draw for the mutual, its members and by extension their policyholders and the economy at large…
* A familiar face to the more venerable figures of the Lloyd’s market as he headed a McKinsey team (alongside Bronek Masojada, who later joined Hiscox) that advised Lloyd’s on navigating the traumas of the early-to-mid nineties and in doing so paved the way for the arrival of corporate capital…
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