Committee publication · Correspondence · 2 September 2025
Letter from Pool Re relating to potential measures to bolster the UK's economic resilience, 22 July 2025
From: Business and Trade Sub-Committee on Economic Security, Arms and Export Controls
Inquiry: UK economic security
Summary
Pool Re's CEO writes to the Business and Trade Sub-Committee outlining the organisation's role as the UK's government-backed terrorism reinsurer and potential expansion into broader economic resilience. Pool Re currently covers £2.3 trillion in commercial property assets and proposes extending its model to address protection gaps in cyber risk, critical infrastructure, and other systemic threats.
Key findings
- Pool Re covers approximately £2.3 trillion of commercial property assets across Great Britain and pays £250m annually to HM Treasury for the government guarantee; scheme losses would need to exceed £13 billion before taxpayer support is required.
- Protection gaps exist in Pool Re's current scope: undersea power cables, offshore wind farms, ferries, offshore oil & gas assets, nuclear power stations, residential property, and cyber terrorism.
- Pool Re proposes extending its model beyond terrorism to address systemic risks including catastrophic cyber scenarios not covered by private insurers, citing precedent of insurance-based Public Private Partnerships globally.
- Pre-disaster resilience mechanisms enable rapid, predictable liquidity injection into the economy and give the insurance industry confidence to underwrite risks and develop products.
- Recent events like the Covid pandemic illustrate risks when government becomes insurer of first resort rather than last resort, exhausting private market resources first.
Tone
SupportiveTopics
Key actors
Tom Clementi, Liam Byrne MP, Pool Re, HM Treasury, Business and Trade Sub-Committee on Economic Security, Arms and Export Controls
Notable line
“… on the nation's finances illustrate the risk to the UK economy when the Government is the country's insurer of first resort rather than the insurer of last resort stepping …”
Key Quotes
“Pool Re is the UK's government-backed terrorism reinsurer and globally recognised as the leading expert in terrorism risk financing.”
“Today the scheme's losses would need to exceed c.£13 billion before any taxpayers' support would be required to pay claims following a terrorist attack.”
“… a number of protection gaps exist which may merit further consideration in the context of the contemporary threat landscape, for instance in relation to undersea power cables, offshore wind farms, ferries, offshore oil & gas assets, nuclear power stations, residential property and cyber terrorism.”
“… resilience mechanisms put in place before a disaster strike can ensure that when incidents do occur …”
Source · parliament.uk record ↗