Pool Re completes renewal of £2.75bn retrocession placement

UK government backed mutual terrorism reinsurance firm Pool Re has completed the placement of its 2026 retrocession placement, securing £2.75 billion of aggregate excess of loss cover, which also includes new cover for non-damage business interruption (NDBI).

Regarding the size, the £2.75 billion of retro reinsurance protection obtained through this 36-month placement remains consistent with the 2025 renewal, and for 2026 was placed with 65 international reinsurers.

The retro programme provides reinsurance for property damage resulting from acts of terrorism certified by the UK Government.

As per Pool Re, this includes chemical, biological, radiological and nuclear events, as well as damage caused by remote digital interference.

For 2026, the programme has also been expanded to include cover for non-damage business interruption, sub-limited to £25 million.

Pool Re’s retrocession program shifts risk to the private sector and is designed to guarantee that all businesses in Great Britain have access to affordable and comprehensive terrorism insurance.

A key component of Pool Re’s retro tower for 2026 is the £100 million Baltic PCC Limited (Series 2025-1) catastrophe bond that was issued in March 2025, shortly after the firm upsized its traditional retro reinsurance program to £2.75 billion for its 2025 renewal.

This marked the second renewal of its landmark terrorism catastrophe bond and the third issuance in the Baltic series.

We have heard from sources recently that Pool Re now has an appetite to return to the cat bond market, in order to stagger maturing coverage from the capital markets. It will be interesting to see if anything in the way of a new Baltic cat bond issuance appears this year, or whether that might be timed for around next year’s renewal of the retrocession.

Pool Re has so far secured £275 million of retro terrorism ILS capacity from UK domiciled special-purpose vehicle Baltic PCC Ltd. via cat bond issuances in 2019, 2022, and 2025, to support its retrocessional reinsurance program arrangements.

“This marks another successful milestone for the business. It’s very encouraging to have received such strong support from reinsurers, with a number of partners increasing their capacity. The strong market reception reinforces our conviction in our strategy and in our role as the ultimate backstop against terrorism for the UK Commercial Property market,” commented Jonathan Gray, Pool Re’s Chief Underwriting Officer.

“We are delighted to have completed yet another successful renewal of our retrocession programme with the invaluable support of Guy Carpenter. Backed by a record number of retrocession partners, the programme remains a core part of our strategy to return risk into private hands and thereby distance the UK taxpayer from loss following a major terrorism event,” said Tom Clementi, Pool Re’s CEO.

Adding: “In bolstering Pool Re’s capital position and safeguarding Members’ funds the programme also ensures that Pool Re is well placed to provide resilience to the UK economy should it ever be needed.”