Home / Regulatory & Government / ARPC outlines payment plan to Canberra
10 September 2018
The Australian Reinsurance Pool Corporation (ARPC) will compensate the Federal Government $55 million a year over the next four financial years for provision of the Commonwealth guarantee.
It will also pay a $35 million capital holding fee annually until 2021/22.
The payment schedule is outlined in the ARPC’s corporate plan for the financial years to June 30 2022.
As of June, the ARPC has about $13.4 billion in funding available for claims in the event of a declared terrorist incident.
Reinsurers, as retrocessionaires, provided about $3.06 billion of private cover for claim payments above the $285 million ARPC deductible and any industry retentions.
The scheme expects about $161.2 million in gross written premium this financial year and anticipates premium will reach at least $162 million in the next three years.
“During the current year there have been some increases in commercial property insurance premiums as insurers have raised prices to offset higher reinsurance costs, owing to increased global natural catastrophe losses [last year],” the corporate plan says.