Underwriting agency CHU says its strata and build-to-rent portfolios will enter the Federal Government’s cyclone reinsurance pool in July.

The pool, run by the Australian Reinsurance Pool Corporation (ARPC), is backed by a $10 billion government guarantee and aims to reduce premiums in cyclone-affected regions by foregoing a profit margin.

Large insurers have until the end of this year to join, while small insurers have until the end of next year. Sure Insurance and Allianz are the only other insurers to so far announce that they have started accessing the pool.

CHU, which is owned by Steadfast and underwritten by QBE, says its residential and commercial strata portfolios, FLEX’s strata portfolio and CHU’s build-to-rent portfolio will join the pool in July.

CHU’s remaining portfolios of community association, lot owner homes, contents and landlords for strata will join the pool towards the end of this year.

“CHU welcomes measures that assist property owners with affordability and access to suitable insurance products,” CHU CEO Kimberley Jonsson said.

“CHU understands the financial stress individual householders are under with rising inflation and cost of living pressures, and this is a positive step towards alleviating these pressures in some instances.”

The criteria for eligibility under the pool for strata schemes is:

• Residential strata schemes (including mixed use schemes where 50% or more floorspace is used for residential purposes)

• Commercial strata schemes where the combined building sum insured and common area contents value does not exceed $5 million.

“It has been a long journey,” Head of Underwriting at CHU Steve Tchepak said.

“We knew the deadline for participation would be challenging. The amount of work required in reconfiguring pricing calculations, implications on reinsurance, updates to systems was and continues to be substantial.

“We are pleased that any pricing benefits from the cyclone pool can now flow on to customers.”

The level of savings that the pool will deliver to consumers has been hotly debated.

The latest available estimates show average savings in the highest risk areas of 32% for home and 13% for SMEs, with insufficient data to show an equivalent figure for strata.