Category: Press Release

McGill and Partners has launched a groundbreaking, war risk reinsurance facility for commercial property in Ukraine. This new offering is the first of its kind, leveraging AI-powered technology to enhance the understanding and underwriting of commercial property risks in the region. 

FortuneGuard, a Lloyd’s Lab Insurtech, utilises official data on projectiles fired into the country to assess the likelihood of war damage, and to support risk presentation, analysis, and underwriting. With live data risk monitoring, this approach enables underwriters to more accurately evaluate risks and offer affordable premiums for businesses in Ukraine.  

Supporting Ukraine’s economic recovery and resiliency efforts, McGill and Partners has also collaborated with local Ukrainian insurer, ARX, to create a product that will enable up to $50M in coverage to be offered per risk, with reinsurance capacity provided by the London market and Lloyd’s syndicates.  

Coverage will be provided for properties located more than 100 kilometers from the front line. Since the outbreak of the war with Russia, the international reinsurance market has largely withdrawn from providing capacity for war risk reinsurance in Ukraine. While there have been some recent initiatives focused on covering mobile assets, the only coverage available for commercial property assets to date has been through local insurers, such as ARX, and limited to policy limits of $500,000. 

Reinsurers will work with ARX to enable quotes to be issued to new clients this month, with access to the reinsurance facility expected to be expanded in due course to additional local insurers.  

Steve McGill CBE, Founder and CEO of McGill and Partners said: “As Ukraine continues to navigate the devastating impacts of war, we recognise the significant role of the insurance industry in supporting Ukraine’s economic regrowth. Providing critical coverage for businesses in Ukraine, the launch of this groundbreaking facility marks a significant milestone in supporting Ukraine’s economic recovery and resiliency.” 

 “By harnessing the power of AI and comprehensive data sets, we have been able to take a more informed approach to presenting and underwriting risk. This approach has enabled us to deliver scalable reinsurance capacity at an accessible premium, adding critical coverage for businesses that were largely unprotected.”  

Oleksii Omelianchuk, Founder and CEO of FortuneGuard, said: “This historic facility is a game-changer for Ukraine’s commercial sector and investors. Offering unprecedented policy limits of up to $50 million, it provides coverage that was previously unavailable in the market. By leveraging cutting-edge AI-driven analytics, local expertise, and comprehensive data, we can provide affordable and scalable coverage for businesses and investors operating in Ukraine. Developed with input from Lloyd’s experts, this initiative not only secures assets but also provides the confidence businesses need to continue operating and rebuilding in these challenging times.”  

Maksym Mezhebytskyi, first Deputy Chairman of the Board and member of the Board of ARX, noted: “A year and a half ago, no one in Ukraine could even dream of this. We are very pleased Lloyd’s and the London private reinsurance markets have recognised the critical need for a property reinsurance product against war risks, and we are proud to be the first in Ukraine to introduce this product.  

This became possible, among other things, as a result of the experience we have accumulated over the past year and a half, and our partnership with McGill and Partners. We hope that similar products will continue to develop, and the number of insurers and reinsurers involved in them will only increase.” 

McGill and Partners announces the launch of Underscore Auton (“Auton”). Auton is the first-ever fully digital cross-class follow form, broker facility in the Lloyd’s market, providing clients with significant benefits ahead of the 1/1 renewal season.  

This innovative, auto-follow facility enables clients to access up to 20% capacity across multiple lines of business, underwritten in the Lloyd’s market. Auton is backed by a panel of Lloyd’s insurers, benefiting from Lloyd’s AM Best rating of A+, led by Beazley’s Smart Tracker Syndicate. In addition to Beazley, participating syndicates currently include Canopius, AXIS, Munich Re Specialty and more. 

For the Lloyd’s market, Auton is the first facility of its kind. The recent Lloyd’s Market Association report, which looks at the growth of enhanced underwriting in the Lloyd’s market, highlights the growing demand for digital, data-driven platforms. In relation to this, McGill and Partners identified the need to leverage technology for more efficient market access on behalf of their clients.  

Developed in partnership with Verisk, Auton provides intelligent automated risk selection through a bespoke rules engine and is part of Underscore, McGill and Partners’ proprietary digital and data-driven broking platform. 

Since its formation in 2019, McGill and Partners has taken a digital-first and cutting-edge approach to technology. With Auton, clients worldwide will benefit from a more simplified placement process and a greater focus on the negotiation of more attractive lead terms. Additionally, at a time of increased complexity in the risk environment, clients can have confidence in accessing up to 20% pre-arranged insurance capacity across multiple lines of business. Participating carriers have unparalleled visibility and live access to the underlying data for the Auton portfolio through a dynamic dashboard created with Moody’s.  

Steve McGill, Founder and CEO of McGill and Partners said, “The launch of Auton provides highly effective automatic and digitally enabled Lloyd’s follow form capacity for our clients underpinned by live data access for our underwriting partners. “From the start, McGill and Partners has been built on digital-first principles and we understand the importance of capitalising on technology. As an industry first, Auton is a testament to the calibre of our team and trading partners that have developed this innovative facility. Auton very much aligns with Lloyd’s ambitious plans to deliver profound change in the market through digitalisation and I am proud of the part McGill and Partners is playing in that transformation.”  

Alok Kumar, Managing Director Analytical Services, Moody’s said, “Auton revolutionises risk assessment by integrating Moody’s RMS Intelligent Risk Platform with cutting-edge automation and analytical expertise for unparalleled speed in loss modelling and portfolio analysis. We have transformed both structured and unstructured data into dynamic dashboards providing carriers with risk insights and relevant model outputs for informed decision-making and strategic adjustments.”  

Tim Rayner, President of Specialty Business Solutions at Verisk, said, “Auton demonstrates the power of automation that can be achieved by combining a digital contract with a rules engine, enabling fully digital and algorithmic risk selection. This is an outstanding example of how the relationships between brokers and underwriters can be brought into the ‘digital room,’ people, technology and data working together.” 

McGill and Partners has appointed Andre du Preez as Head of Emerging Technology. In his new role, Andre will play a key part in building on McGill and Partners’ digital first strategy.  

He will drive innovation by leveraging cutting-edge technologies and fostering a culture of creativity, to ensure McGill and Partners remains at the forefront of the industry. He has proven experience of developing and rolling out machine learning applications, which will further enhance McGill and Partners’ proposition for its clients.  

Andre joins McGill and Partners from Miller, where he was Head of Innovation and led the development and adoption of cutting-edge technological solutions, with a strong focus on artificial intelligence. Previously, he held roles developing digital products at Miller and also Vitality. Prior to this, he worked in business consultancy in both London and Johannesburg.  

Simon Bradbury, Chief Technology Officer at McGill and Partners said: “Andre is an extremely talented professional in the insurance market, with a proven ability to develop and harness emerging technologies and digital products. His extensive experience in pioneering advanced technology will be a tremendous asset as we drive innovation and explore new technical opportunities. We are excited to have him join our team and look forward to the impact he will have alongside our exceptional group of experts.”  

Andre du Preez, Head of Emerging Technology at McGill and Partners said: “Joining McGill and Partners is an incredible opportunity, as the firm has consistently been a trailblazer with its digital-first strategy and its freedom from outdated legacy systems. This forward-thinking approach unlocks endless possibilities, and I’m excited to contribute to it. By staying ahead of emerging trends, I’m eager to help develop innovative strategies and solutions that enhance client value, improve operational efficiency, and strengthen McGill and Partners’ competitive edge.” 

McGill and Partners has launched a new trade disruption insurance facility in collaboration with Tokio Marine Kiln (TMK) and Convex, offering limits of $95M, led by TMK. This unique offering harnesses the power of AI enabled technology provided by Altana, to support the understanding and underwriting of trade disruption risk.  

This will enable substantial coverage and limits for clients navigating interruptions and fluctuations of trade between specified locations. Altana’s AI platform enhances the client and underwriter experience by improving service speed and accuracy, while streamlining the preparation and review of Trade Disruption Insurance (TDI) submissions. The increased visibility this gives underwriters, enables them to offer broader coverage and higher limits, across all sectors and geographies. It also provides clients and underwriters with a dynamic, comprehensive view of the world’s interconnected supply chains.  

Nicky Payne, Partner of Capital Solutions and Treaty Reinsurance at McGill and Partners said, “Given the current geopolitical climate, the launch of our groundbreaking trade disruption facility is exceptionally timely, as incidents of this nature are on the rise. From the start, McGill and Partners has been built on digital-first principles. We understand the importance of capitalising on this technology, which allows us to pioneer unique and innovative solutions for our clients. This product is a clear demonstration of those principles.  

Working with TMK and Convex, both recognised leaders in the market for trade disruption risk, was an obvious choice. I am proud that, together, we have brought this facility to the market for our clients.” 

Ed Parker, Head of Special Risks at TMK said, “Tokio Marine Kiln has been at the forefront of innovation in this class since we launched the world’s first trade disruption cover over thirty years ago. Driving and supporting new solutions which can address the challenges which our clients are facing is core to our offering and central to TMK’s business philosophy. Supply chains, globally, have become increasingly complex and their fragility has been underscored by a series of geopolitical shocks in recent years. AI offers the potential for us to better understand our clients, to track the movement of goods and the aggregation of exposures in real time. These new tools can enhance our offering, allow us to broaden our terms due to a greater insight into our clients’ businesses and enable us to further extend our support across supply chains. We are pleased to lead this new facility and look forward to working with our partners to continue to enhance the service we offer to the global trade sector.”  

Evan Smith, co-founder and CEO of Altana said, “Managing supply chain disruptions is a key priority for risk managers. This TDI (trade disruption insurance) facility represents an important step toward the delivery of AI-powered insurance solutions. We’re excited to join forces with McGill and Partners, TMK and Convex, to support businesses in managing through increasing global supply chain dislocations.” 

McGill and Partners announces that it will be expanding into the Nordics with the opening of a new branch office in Sweden subject to applicable approvals.  

This expansion into the Nordics will strengthen McGill and Partners’ extensive broking expertise across its key specialties and further enable the firm to deliver cutting-edge solutions to their global clients and trading partners. The new branch will be part of the firm’s European entity. Initial hires to the Swedish branch will include Jon Petursson and Wilhelm Westerstad. 

 Jon and Wilhelm will each join from WTW, where they have spent over two decades, and have been instrumental in developing a diverse portfolio of specialty- focussed business in the Nordics and beyond. They will join McGill and Partners once their existing contractual obligations are fulfilled. 

 Stephen Cross, CEO of McGill and Partners Europe, said: “We are laser-focused on attracting incredible talent in markets where there is untapped potential, and we’re excited to be expanding our presence and capabilities in Europe with the opening of a Swedish office. With Jon and Wilhelm joining the team we will be able to draw on their deep expertise to provide market-leading solutions for our clients and trading partners in the region, whilst we continue to attract like-minded individuals to our rapidly expanding firm.”

McGill and Partners is delighted to announce the appointment of Nick Williams-Walker as Group Chief Operating Officer, with effect from 23 September 2024.  

Nick joins McGill and Partners from Gallagher where he has been COO of Alesco and Gallagher Specialty for five years. Prior to this Nick was at JLT for almost eight years as COO of JLT Specialty and was formerly at Aon for over 13 years in a series of senior operationally focussed leadership roles including an extended period in India overseeing the establishment of the Aon operations in the country. Nick also serves as the Chair of the Technical Group of the London Market Group’s Data Council.  

Nick will succeed Stephen Cross in this role, who has been the firm’s acting Group COO since January 2022. Stephen Cross, one of the co-founders of McGill and Partners, will continue his role of Head of Strategy and Innovation, focussing on strategy, innovation, talent acquisition, and brand and marketing. He will also continue to maintain responsibility for Europe. 

Nick has a long history in the specialty intermediary space and his experience of optimising client service, innovation and leveraging gains and efficiencies from technology over many years will be a huge asset to a digital-first business such as McGill and Partners, which takes a cutting-edge approach to technology.  

Steve McGill, CEO and founder of McGill and Partners, said: “As we continue to pursue exceptional talent, we are delighted to welcome Nick as Group Chief Operating Officer of McGill and Partners. Nick brings extensive experience to an already strong and talented team, and we look forward to Nick joining the firm later this month.” 

Crypto crime hit a new all-time high in 2023, accounting for a record-setting $20.6 billion worth of blockchain transactions last year, with the number of blockchain transactions affected by criminal activity doubling compared to 2022.  

But for victims of crypto asset investment fraud, the cost of trying to recover stolen assets can quickly escalate. It can cost upwards of £250,000 to investigate and recover lost crypto assets, and if it is possible to find a litigation funder willing to act purely on a contingency basis, they will likely require a significant cut of the value of any recovery.  

To combat this, M2 Recovery has launched its pioneering crypto legal expenses policy – the world’s first insurance policy for recovery of crypto assets valued at more than £250,000, addressing the pressing need for protection against the rising tide of crypto fraud. M2  

Recovery founder Neil Holloway says: “Our insurance policy is the first of its type globally, which provides policyholders with legal expenses following crypto fraud. We can insure legal expenses relating to crypto assets collectively worth tens of millions for investors, neobanks and in-play betting companies. “This includes digital assets invested through the metaverse, utility tokens such as Freeway Tokens, and crypto assets appropriated through man-in-the-middle attacks. And with more investment scams in play than ever before, reducing your exposure to risk on large crypto investments has never been more important.” Crypto investors buying a policy have access to M2 Recovery’s market leading in-house legal team to recover the lost assets. The costs of recovery are also covered by the policy. It’s the only insurance product in the marketplace that covers up to £250,000 of legal expenses and disbursements associated with recovering assets lost as a result of any type of theft or fraud.  

McGill and Partners, the global boutique specialist (re)insurance broker, has assisted M2 Recovery in the design and placement of the policy with Lloyd’s of London insurers to allow M2 Recovery to launch this product. 

Paul Morgan, Partner in the Financial Lines team at McGill and Partners said: “The issue of fraud and loss of assets is a growing problem in the crypto world, and we’re delighted to be working with M2 Recovery on this pioneering solution, offering pre-incident crypto legal expenses insurance. That we’ve been able to work in partnership to develop a solution that responds to a pressing need, emphasises the agility we have as a business to respond quickly and in a way that meets the pressing needs of the marketplace more widely.” 

M2 Recovery’s director of legal services Louise Abbott said: “The threat to crypto assets has never been greater, with cyber criminals becoming increasingly sophisticated in how they act. We have built a team of cyber intelligence specialists, recovery agents, forensic investigators and expert lawyers, all working under one roof with our proprietary technology to combat this fraud. “In what is an incredibly complicated market, we are incredibly proud to have a 100% success rate, and this new policy means more victims will be able to use our exceptional skill set to recover their crypto assets” 

McGill and Partners has expanded its ports and terminals offering with the appointment of Julien Horn as a Partner. Julien joins the team headed up by Julien Hubbard, adding expertise in logistics and transportation. Julien joins McGill and Partners from TT Club, an independent provider of mutual insurance to the international transport and logistics industry.  

He worked at TT Club since 2006 and spent the last four years as a Senior Underwriter in the marine division. At TT Club his work focussed on the Middle East, Africa, Eastern Mediterranean and Turkey. Prior to that Julien spent six years as Business Development Director in Dubai for TT Club, with responsibilities for the Middle East, India and Africa. Over the past decade, Julien has cultivated significant relationships across the Middle East and the broader MENA region.  

This, combined with his abilities to solve issues for large clients, means that Julien is well-placed to take on this role at McGill and Partners. As ports and terminals operators pivot their business models into logistics, Julien brings a wealth of knowledge to support both existing and new clients in this increasingly complex area of transportation business. 

 Julien Hubbard, Partner and Head of Ports and Terminals at McGill and Partners said: “It is fantastic to welcome someone of Julien’s calibre to the team. His business development skills, whether it be nurturing current relationships or exploring new opportunities, will be a tremendous asset to the firm. However, Julien will also bring a new dynamic to the team and his skillset will undoubtedly enhance our ports and terminals offering.” 

The Facility has been established by insurance and reinsurance broker McGill and Partners with extensive support from the Association of British Insurers (ABI) and also through working in partnership with the British Insurance Brokers’ Association (BIBA) which will ensure brokers are made aware of the Facility. It has two key intentions – to expand capacity for insurers already writing business for affected buildings and to encourage competition across the market so that more firms will provide cover. The ultimate solution remains the urgent need for works to take place to make buildings safe and resilient.  

The Facility is expected to run for three to five years whilst this happens. The first step will be for the participating insurers – Allianz, Aviva, Axa, RSA and Zurich – to enter higher-risk buildings they currently insure, and which are awaiting remediation works, into the Facility at the point of their annual renewal. These firms have continued to be active in the market and are the top five firms providing insurance cover for commercial and residential buildings.  

The Grenfell tragedy and Dame Judith Hackitt Review exposed significant construction and fire-risk issues related to these buildings. As a result, insurers have to consider the heightened risk of an entire building sadly being destroyed in the event of a fire and have had to limit the amount of cover they could provide because the risk is too high for one firm to cover on its own.  

Brokers, Freeholders and Managing Agents have instead had to source insurance cover from multiple firms, meaning that several insurers are involved in covering one building, creating a ‘layered’ effect and adding to the cost. It is these buildings which will likely benefit most from the Facility.  

Through a reinsurance panel led by Swiss Re, the Facility will enable insurers to expand the capacity they have for writing insurance for affected buildings and take on new business. Over the course of the following 12 months, the insurers will consider which additional buildings can be entered into the Facility as and when their insurance policies are due for renewal.  

We have long recognised the emotional and financial strain that is being placed on leaseholders in England, Wales and Northern Ireland and flat owners in Scotland, and we support the FCA’s rules on providing greater protection and transparency. While the launch of the Facility is an important milestone, we have always said that there will be no single insurance intervention that will help all leaseholders equally. It is the buildings that will see the costly ‘layered’ insurance replaced with cover through the Facility that will likely see the biggest impact on their premium. 

 For buildings where one insurer already provides 100% of the cover, they may not see an impact on their premium when entered into the Facility. In the longer term, it is hoped that the Facility will reinvigorate competition in the market and encourage other firms to write more business for affected buildings. There are options available to government that could have a more immediate impact for leaseholders. This includes providing financial support to the Facility which may increase market confidence and encourage even more firms to join, and cutting Insurance Premium Tax which would provide a 12% reduction in costs.  

Leaseholders should contact the person or company responsible for arranging their insurance cover, who can then discuss the Facility with their broker or insurer. More information on how the Facility will work is available here. Information for brokers representing the affected buildings is available from the British Insurance Brokers’ Association. Buildings insurance premiums will continue to be based on a variety of risk factors, such as the type and age of the building, previous claims history and other property risks such as storm/flooding or escape of water. External factors such as construction costs and supply shortages will also have an impact.  

Steve McGill CBE, Founder & CEO, McGill and Partners said: “Insuring cladded, multi-occupancy buildings that pose a fire safety risk has challenged our industry for some time. However, this unique facility aims to present a competitive market solution that will address this important issue and I am incredibly proud that McGill and Partners has played such a pivotal role. “Contributing to the expansion of insurance availability for buildings with combustible cladding and other fire safety issues has been a significant priority for us. We are known for our innovative thinking and thrive on creating solutions for complex and challenging risks, and it has been possible to develop this transformative and much needed facility with the support of our reinsurer and insurer partners.” 

 Mervyn Skeet, ABI Director of General Insurance said: “Supporting leaseholders and making insurance more widely available for higher-risk buildings with fire safety issues has been one of the ABI’s top priorities. I’m grateful to McGill and Partners and all the firms involved for their help in establishing this commercial intervention and hope it will encourage more insurers to enter the market and offer cover for these buildings. “The industry has been determined in its efforts to support leaseholders, but it cannot solve the issue alone. Establishing the Facility is a significant step forward, but Government intervention and swifter remediation is still the only long-term solution. We strongly encourage Government to consider how it can support the Facility to boost confidence in the market or remove Insurance Premium Tax for affected buildings, to offer more immediate relief to leaseholders.”  

Tim Bailey, President of the ABI, said: “The Fire Safety Reinsurance Facility has been a priority cross-industry project to expand capacity in the market and boost competition. We’re pleased to have made the Facility a reality in order to support leaseholders and as ABI President, I’m grateful to all those involved.” Aidan Kerr, UK&I Lead at Swiss Re Public Sector Solutions, said: “Swiss Re is delighted to be acting as lead reinsurer for this facility, which is a great demonstration of how the insurance industry can work together to help support leaseholders. This facility will help to improve availability of insurance for people living in affected buildings, whilst the vital remediation work to rectify their fire safety issues is completed.”  

Graeme Trudgill, Chief Executive at the British Insurance Brokers’ Association (Biba), said: “We are delighted with this new facility, which is the culmination of two years of constructive collaboration between BIBA, McGill and Partners, the ABI, expert real-estate brokers and Government. Launching the facility was a key BIBA commitment in our 2024 Manifesto and aims to create a more affordable insurance solution for medium and high-rise residential buildings that have fire safety issues. We hope that in the longer term this will have positive affect on leaseholders.” 

Reinsurance support is now in place to launch the Fire Safety Reinsurance Facility (the Facility) from 1 April 2024, in an industry intervention to help improve the availability of insurance for certain buildings with combustible cladding and other fire safety issues.  

The Facility has been established by insurance and reinsurance broker McGill and Partners with extensive support from the Association of British Insurers (ABI) and also through working in partnership with the British Insurance Brokers’ Association (BIBA) which will ensure brokers are made aware of the Facility. It has two key intentions – to expand capacity for insurers already writing business for affected buildings and to encourage competition across the market so that more firms will provide cover. The ultimate solution remains the urgent need for works to take place to make buildings safe and resilient.  

The Facility is expected to run for three to five years whilst this happens. The first step will be for the participating insurers – Allianz, Aviva, Axa, RSA and Zurich – to enter higher-risk buildings they currently insure, and which are awaiting remediation works, into the Facility at the point of their annual renewal. These firms have continued to be active in the market and are the top five firms providing insurance cover for commercial and residential buildings.  

The Grenfell tragedy and Dame Judith Hackitt Review exposed significant construction and fire-risk issues related to these buildings. As a result, insurers have to consider the heightened risk of an entire building sadly being destroyed in the event of a fire and have had to limit the amount of cover they could provide because the risk is too high for one firm to cover on its own.  

Brokers, Freeholders and Managing Agents have instead had to source insurance cover from multiple firms, meaning that several insurers are involved in covering one building, creating a ‘layered’ effect and adding to the cost. It is these buildings which will likely benefit most from the Facility.  

Through a reinsurance panel led by Swiss Re, the Facility will enable insurers to expand the capacity they have for writing insurance for affected buildings and take on new business. Over the course of the following 12 months, the insurers will consider which additional buildings can be entered into the Facility as and when their insurance policies are due for renewal.  

We have long recognised the emotional and financial strain that is being placed on leaseholders in England, Wales and Northern Ireland and flat owners in Scotland, and we support the FCA’s rules on providing greater protection and transparency. While the launch of the Facility is an important milestone, we have always said that there will be no single insurance intervention that will help all leaseholders equally. It is the buildings that will see the costly ‘layered’ insurance replaced with cover through the Facility that will likely see the biggest impact on their premium. 

 For buildings where one insurer already provides 100% of the cover, they may not see an impact on their premium when entered into the Facility. In the longer term, it is hoped that the Facility will reinvigorate competition in the market and encourage other firms to write more business for affected buildings. There are options available to government that could have a more immediate impact for leaseholders. This includes providing financial support to the Facility which may increase market confidence and encourage even more firms to join, and cutting Insurance Premium Tax which would provide a 12% reduction in costs.  

Leaseholders should contact the person or company responsible for arranging their insurance cover, who can then discuss the Facility with their broker or insurer. More information on how the Facility will work is available here. Information for brokers representing the affected buildings is available from the British Insurance Brokers’ Association. Buildings insurance premiums will continue to be based on a variety of risk factors, such as the type and age of the building, previous claims history and other property risks such as storm/flooding or escape of water. External factors such as construction costs and supply shortages will also have an impact.  

Steve McGill CBE, Founder & CEO, McGill and Partners said: “Insuring cladded, multi-occupancy buildings that pose a fire safety risk has challenged our industry for some time. However, this unique facility aims to present a competitive market solution that will address this important issue and I am incredibly proud that McGill and Partners has played such a pivotal role. “Contributing to the expansion of insurance availability for buildings with combustible cladding and other fire safety issues has been a significant priority for us. We are known for our innovative thinking and thrive on creating solutions for complex and challenging risks, and it has been possible to develop this transformative and much needed facility with the support of our reinsurer and insurer partners.” 

 Mervyn Skeet, ABI Director of General Insurance said: “Supporting leaseholders and making insurance more widely available for higher-risk buildings with fire safety issues has been one of the ABI’s top priorities. I’m grateful to McGill and Partners and all the firms involved for their help in establishing this commercial intervention and hope it will encourage more insurers to enter the market and offer cover for these buildings. “The industry has been determined in its efforts to support leaseholders, but it cannot solve the issue alone. Establishing the Facility is a significant step forward, but Government intervention and swifter remediation is still the only long-term solution. We strongly encourage Government to consider how it can support the Facility to boost confidence in the market or remove Insurance Premium Tax for affected buildings, to offer more immediate relief to leaseholders.”  

Tim Bailey, President of the ABI, said: “The Fire Safety Reinsurance Facility has been a priority cross-industry project to expand capacity in the market and boost competition. We’re pleased to have made the Facility a reality in order to support leaseholders and as ABI President, I’m grateful to all those involved.” Aidan Kerr, UK&I Lead at Swiss Re Public Sector Solutions, said: “Swiss Re is delighted to be acting as lead reinsurer for this facility, which is a great demonstration of how the insurance industry can work together to help support leaseholders. This facility will help to improve availability of insurance for people living in affected buildings, whilst the vital remediation work to rectify their fire safety issues is completed.”  

Graeme Trudgill, Chief Executive at the British Insurance Brokers’ Association (Biba), said: “We are delighted with this new facility, which is the culmination of two years of constructive collaboration between BIBA, McGill and Partners, the ABI, expert real-estate brokers and Government. Launching the facility was a key BIBA commitment in our 2024 Manifesto and aims to create a more affordable insurance solution for medium and high-rise residential buildings that have fire safety issues. We hope that in the longer term this will have positive affect on leaseholders.” 

Reinsurance support is now in place to launch the Fire Safety Reinsurance Facility (the Facility) from 1 April 2024, in an industry intervention to help improve the availability of insurance for certain buildings with combustible cladding and other fire safety issues.  

The Facility has been established by insurance and reinsurance broker McGill and Partners with extensive support from the Association of British Insurers (ABI) and also through working in partnership with the British Insurance Brokers’ Association (BIBA) which will ensure brokers are made aware of the Facility. It has two key intentions – to expand capacity for insurers already writing business for affected buildings and to encourage competition across the market so that more firms will provide cover. The ultimate solution remains the urgent need for works to take place to make buildings safe and resilient.  

The Facility is expected to run for three to five years whilst this happens. The first step will be for the participating insurers – Allianz, Aviva, Axa, RSA and Zurich – to enter higher-risk buildings they currently insure, and which are awaiting remediation works, into the Facility at the point of their annual renewal. These firms have continued to be active in the market and are the top five firms providing insurance cover for commercial and residential buildings.  

The Grenfell tragedy and Dame Judith Hackitt Review exposed significant construction and fire-risk issues related to these buildings. As a result, insurers have to consider the heightened risk of an entire building sadly being destroyed in the event of a fire and have had to limit the amount of cover they could provide because the risk is too high for one firm to cover on its own.  

Brokers, Freeholders and Managing Agents have instead had to source insurance cover from multiple firms, meaning that several insurers are involved in covering one building, creating a ‘layered’ effect and adding to the cost. It is these buildings which will likely benefit most from the Facility.  

Through a reinsurance panel led by Swiss Re, the Facility will enable insurers to expand the capacity they have for writing insurance for affected buildings and take on new business. Over the course of the following 12 months, the insurers will consider which additional buildings can be entered into the Facility as and when their insurance policies are due for renewal.  

We have long recognised the emotional and financial strain that is being placed on leaseholders in England, Wales and Northern Ireland and flat owners in Scotland, and we support the FCA’s rules on providing greater protection and transparency. While the launch of the Facility is an important milestone, we have always said that there will be no single insurance intervention that will help all leaseholders equally. It is the buildings that will see the costly ‘layered’ insurance replaced with cover through the Facility that will likely see the biggest impact on their premium. 

For buildings where one insurer already provides 100% of the cover, they may not see an impact on their premium when entered into the Facility. In the longer term, it is hoped that the Facility will reinvigorate competition in the market and encourage other firms to write more business for affected buildings. There are options available to government that could have a more immediate impact for leaseholders. This includes providing financial support to the Facility which may increase market confidence and encourage even more firms to join, and cutting Insurance Premium Tax which would provide a 12% reduction in costs.  

Leaseholders should contact the person or company responsible for arranging their insurance cover, who can then discuss the Facility with their broker or insurer. More information on how the Facility will work is available here. Information for brokers representing the affected buildings is available from the British Insurance Brokers’ Association. Buildings insurance premiums will continue to be based on a variety of risk factors, such as the type and age of the building, previous claims history and other property risks such as storm/flooding or escape of water. External factors such as construction costs and supply shortages will also have an impact.  

Steve McGill CBE, Founder & CEO, McGill and Partners said: “Insuring cladded, multi-occupancy buildings that pose a fire safety risk has challenged our industry for some time. However, this unique facility aims to present a competitive market solution that will address this important issue and I am incredibly proud that McGill and Partners has played such a pivotal role. “Contributing to the expansion of insurance availability for buildings with combustible cladding and other fire safety issues has been a significant priority for us. We are known for our innovative thinking and thrive on creating solutions for complex and challenging risks, and it has been possible to develop this transformative and much needed facility with the support of our reinsurer and insurer partners.” 

Mervyn Skeet, ABI Director of General Insurance said: “Supporting leaseholders and making insurance more widely available for higher-risk buildings with fire safety issues has been one of the ABI’s top priorities. I’m grateful to McGill and Partners and all the firms involved for their help in establishing this commercial intervention and hope it will encourage more insurers to enter the market and offer cover for these buildings. “The industry has been determined in its efforts to support leaseholders, but it cannot solve the issue alone. Establishing the Facility is a significant step forward, but Government intervention and swifter remediation is still the only long-term solution. We strongly encourage Government to consider how it can support the Facility to boost confidence in the market or remove Insurance Premium Tax for affected buildings, to offer more immediate relief to leaseholders.”  

Tim Bailey, President of the ABI, said: “The Fire Safety Reinsurance Facility has been a priority cross-industry project to expand capacity in the market and boost competition. We’re pleased to have made the Facility a reality in order to support leaseholders and as ABI President, I’m grateful to all those involved.” Aidan Kerr, UK&I Lead at Swiss Re Public Sector Solutions, said: “Swiss Re is delighted to be acting as lead reinsurer for this facility, which is a great demonstration of how the insurance industry can work together to help support leaseholders. This facility will help to improve availability of insurance for people living in affected buildings, whilst the vital remediation work to rectify their fire safety issues is completed.”  

Graeme Trudgill, Chief Executive at the British Insurance Brokers’ Association (Biba), said: “We are delighted with this new facility, which is the culmination of two years of constructive collaboration between BIBA, McGill and Partners, the ABI, expert real-estate brokers and Government. Launching the facility was a key BIBA commitment in our 2024 Manifesto and aims to create a more affordable insurance solution for medium and high-rise residential buildings that have fire safety issues. We hope that in the longer term this will have positive affect on leaseholders.”