IAG BOOSTS CAT REINSURANCE PROGRAMME AS WILDFIRE LOSSES MOUNT

IAG has expanded its reinsurance programme to A$10bn ($6.9bn) in 2020 from A$9bn in 2010 as it tallies the losses from the wildfires of the second half. The Australian carrier increased the multi-year arrangements it has with some of its reinsurance counterparties. Combined with its existing quota-share arrangements, this means that around 70% of IAG’s gross main catastrophe programme for the 2020 calendar-year is protected by multi-year coverage. IAG said it experienced “relatively stable rates” during the renewal process, with the overall expense outcome in line with assumptions. The programme consists of a main catastrophe cover for losses up to A$10bn, including one prepaid reinstatement. IAG will retain the first A$250m of each loss, exactly in line with last year’s programme.