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Political Violence Insurance Peter Schneider, 22 August 2019
Political Violence Insurance
Peter Schneider, 22 August 2019
Peter Schneider | 22 August 2019
• Introduction to Political Violence Insurance
• Political Violence Insurance Products
• Swiss Re Offering
Table of Contents / Agenda
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Introduction to Political Violence Insurance
• Why Political Violence Insurance
• Origins and Evolution
• Context
• Historic Results
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Peter Schneider | 22 August 2019
Political Violence and Terrorism insurance provides cover for assets exposed to war, terrorism and related perils typically excluded from traditional policies.
Why Political Violence Insurance
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• Spans a broad spectrum of risk, from single acts of terrorism, disturbance of the public order to full-scale war
• Mitigates financial impact from property damage and business interruption.
• Mostly sold as a separate policy to complement traditional property and engineering covers
Peter Schneider | 22 August 2019
Historically
• War cover generally excluded (available in Marine and Aviation lines)
• Insurance policies mostly silent on terrorism
Post 9/11 WTC Attacks
• Terrorism excluded fromtraditional policies
• Establishment of terror pools
• Market for terrorism standalonecapacity develops
Today
• Full Political Violence product.
• Up to USD 1.5 billion capacity available
Origins and Evolution of Political Violence Insurance
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Peter Schneider | 22 August 2019
Political Violence insurance is developing as one key element in the broader Crisis Management business
Political Violence in Context
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Political Violence
Marine War
Avn Hull War/
AVN52
Political Risk
Product Recall
K&RCyberAttack
0
500
1000
1500
2000
2500
Marine War Aviation Hull War /Avn52
Political RiskInsurance
Product Recall K&R Cyber Attack Political Violence
Worldwide Market Premium Estimates
Peter Schneider | 22 August 2019
Source: 2000-2013 Lloyd’s market statistics, 2014 and later Swiss Re estimates
London Market Historic ResultsRate Softening Continues but Loss Ratios Stable
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0.0%
5.0%
10.0%
15.0%
20.0%
25.0%
30.0%
35.0%
40.0%
45.0%
50.0%
-
100,000,000
200,000,000
300,000,000
400,000,000
500,000,000
600,000,000
700,000,000
800,000,000
900,000,000
1,000,000,000
London Market Political Violence PerformancePremium Losses Loss Ratio
Political Violence Insurance Products
• Scope of Cover
• Extended Products
• Underwriting
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Peter Schneider | 22 August 2019
Standard Cover: Physical Damage to Buildings and Content
Common Extension: Business Interruption
General Exclusions:
• Nuclear, Biological, Chemical and Radiological Contamination (NBCR)
• War between two or more superpowers (USA, Russia, France, UK, China)
• Cyber attacks
• Active war
Scope of Cover
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Acts of Terrorism
Sabotage
Strikes, Riots and/or Civil Commotion
Malicious Damage
Insurrection, Revolution or Rebellion
Mutiny and/orCoup d’Etat
War and/or Civil War
Basic Terrorism cover Limited PV Cover Full PV Cover
Peter Schneider | 22 August 2019
Terrorism Liability (T3L)
• Liability arising from bodily injury and property damage
Cyber write-back NMA2914
• Write back for named perils resulting from a cyber attack
Threat
• Triggered by a government lockdown resulting from a threat
Active Shooter, Malicious Assailant:
• PD/BI, Liability and Personal Accident claims arising from attacks using deadly weapons
Loss of Attraction
• Protects loss of income resultingfrom a terrorist incident (hotels, restaurants, retailers, tourist attractions)
New Products Address Liability and Non-DamageBusiness Interruption Loss Potential
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Peter Schneider | 22 August 2019
London market wordings exist for all standard coversand main extensions
• Scope of cover
• Exclusions
• Extensions with sublimits
• Definitions, Event clause
• Territorial scope
• Reverse onus of proof / other insurance clause
Underwriting Political ViolenceWording Considerations
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Peter Schneider | 22 August 2019
Claims adjustment
Occupancy
Territorial risk
Primary targets and proximity
MPL assessment
Accumulation potential
Balance Sheet Considerations
Underwriting Political ViolencePricing and Accumulation Considerations
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Swiss Re Offering
• Offer
• Contacts
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Peter Schneider | 22 August 2019
Swiss Re supports all Political Violence classes and is happy to deploy capacity if the business meets risk appetite
We..• Wish to partner with clients by providing comprehensive reinsurance solutions
including terrorism and political violence covers
• Are able to deploy material capacity on proportional and non-proportional reinsurance provided underwriting expertise is present
• Are open to discuss and develop innovative solutions to access new business and support its growth
• Can assist you to build up underwriting expertise by providing supportin developing wordings, rating tables and underwriting guidelines
Swiss Re Offer
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Peter Schneider | 22 August 2019
Adam WatkinsCU Marine and Head UK Marine and Aviation
Sarah MägliHead Crisis Management [email protected]
Peter Schneider Aviation and Crisis Management [email protected]
Lukas SteinmannAviation and Aviation War [email protected]
TBACrisis Management UW
Swiss Re Contacts
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TBA
Peter Schneider | 22 August 2019 16
Peter Schneider | 22 August 2019
Legal notice
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©2019 Swiss Re. All rights reserved. You are not permitted to create any modifications or derivative works of this presentation or to use it for commercial or other public purposes without the prior written permission of Swiss Re.
The information and opinions contained in the presentation are provided as at the date of the presentation and are subject to change without notice. Although the information used was taken from reliable sources, Swiss Re does not accept any responsibility for the accuracy or comprehensiveness of the details given. All liability for the accuracy and completeness thereof or for any damage or loss resulting from the use of the information contained in this presentation is expressly excluded. Under no circumstances shall Swiss Re or its Group companies be liable for any financial or consequential loss relating to this presentation.
