Pool Re broadens SME definition to boost terrorism insurance access

British terrorism mutual Pool Re has broadened its definition of small and medium enterprises (SME) to increase the number of businesses which receive business interruption cover at no extra cost when they buy a physical damage policy.

The reinsurer unveiled the change as part of a number of steps to help reduce costs and improve the accessibility of terrorism insurance for businesses in the UK. Under the plans, the firm has expanded its definition of SMEs to include businesses with assets up to £5 million, which is more than double the previous figure of £2 million. Pool Re said this means that cedant insurers can integrate cover in their automated SME offerings more easily.

Further changes include a reduction in Pool Re’s standard business interruption rating from 0.019 percent to 0.017 percent as well as further rate reductions as a result of advances in the firm’s risk modelling capabilities.

The company also said that clients using its risk Vulnerability Self-Assessment Tool (VSAT) will benefit from a premium discount of 7.5 percent, up from 5 percent.

Steve Coates, Pool Re chief underwriting officer, said: “Pool Re recognises that different buyers have different profiles, and we need to continuously adapt to their needs. Widening the definition of SME – who receive business interruption cover at no cost when they buy a physical damage policy – means that we can offer more affordable terrorism cover and as a result, better accessibility to a wider range of companies.”

Julian Enoizi, Pool Re CEO, said: “These changes overall are about reducing the cost of reinsurance for our cedants, so that those savings can in turn be passed onto the ultimate customer. Pool Re exists to facilitate the effective provision of terrorism insurance and to ensure that it is widely available. These enhancements are all important developments in that process.”