The Australian Reinsurance Pool Corporation’s (ARPC) cumulative payments to the Government will reach $1.02 billion by the 2020 financial year, according to its latest corporate plan.

Payments in fees and dividends since 2012 are forecast to total $845 million by the end of the current financial year, up from $697.5 million at last June 30.

The pool’s 2012 triennial review determined it should start making annual payments to the Government for the $10 billion Commonwealth guarantee, taking into account back payments since its inception in 2003.

The ARPC aims to provide cost-effective reinsurance in cases of terrorism, and has $13.4 billion in funding available for claims, protecting more than 830,000 eligible property assets.

Eligible insured property assets are valued at more than $3.6 trillion nationwide.

Premium income was estimated at $158.5 million in 2016/17, up from $126.2 million the previous year.

The ARPC says the partial market failure of terrorism insurance in the Australian commercial property sector is expected to continue for the foreseeable future.

“Although it is optional for insurers to take out terrorism reinsurance cover, almost all insurers that cover eligible property risks in Australia choose to reinsure their terrorism risk with ARPC,” the corporate report says.

The pool’s operating expenses are expected to rise to $9 million this financial year, up from $8.4 million last year, when vacant positions during a move to Sydney reduced costs.

The ARPC’s retained net assets totalled $455.2 million at June 30, down from $666 million in 2011, due to fees and dividends paid.