Collective call to arms for proactive approach to pan-economic events

Broking legend Liz Foster launches TotusRe, an open collective to help the insurance sector and government plan better coverage for any catastrophic pan-economic event, in response to the fallout due to COVID19.

PRESS RELEASE London (14/05/20): TotusRe invites colleagues across the insurance sector, and partners in UK government, to join on a collaborative mission to address the super-perils present in the UK.

There is currently a lack of coherent risk transfer between what the private insurance market capacity can underwrite, and where the government’s role begins. This “Society Insurance Gap” needs to be closed with certainty and via a replicable and sustainable sector-wide mechanism.

TotusRe is the brainchild of Liz Foster, Non-Executive Director of The Society of Insurance Broking, and James York, Founder at Innovative Risk.

As it is not sustainable to expect the current pandemic response to set a precedent for national risk management, Foster and York have called for a government-back reinsurance umbrella for all known or foreseeable perils.

This reinsurance umbrella should be structured cell by cell, including and appraising each risk in turn, and grouping the existing structures of Pool and Flood.

Foster says: “Whilst the Covid Pandemic is an ongoing human catastrophe – affecting the entire economy and insurance sector – it has revealed the existence of what is best described as a clear and present “Society Insurance Gap”. That being: the uninsured or uninsurable losses of a National Disaster Scenario.

“As some focus on creating a reinsurance platform backed by government for the next pandemic, we believe this isn’t proactive enough. We must think beyond the current peril. There will always be another sizeable aggregate event around the corner.”

The National Risk Register contains known and reasonable aggregate risks. Yet, it does not contain considerations for other sizeable loss events.

York adds: “Other sizeable loss events may sound far-fetched, however, that makes it all the more reasonable to raise them, discuss them, and plan for them. If we are to patch the pandemic risk gap – why stop there?

“Internet Outage. Space Debris. Meteorites. Solar Storms. Shifts in the Jet Stream. Whilst this list sounds like science fiction – none are beyond the realms of possibility. This list is likely far longer.

“At what point does the market exclude and the government include? What is society’s share of the ‘claim’? This triumvirate of uncertainty must be resolved. The United Kingdom has pioneered the insurance sector, let’s unite with government and society to solve the inevitable schism before the event.”

The launch of TotusRe is not political and is not embarked on with profit motive. It is a collective effort to open a dialogue and close the Society Insurance Gap.

The aim of the collective is to close this gap, and created certainty for the market, for the government, and all insured UK businesses. Certainty creates confidence – in our economy and our ability to endure the risks our society inevitably faces in the course of natural time.

Join the collective at www.TotusRe.com

Please direct media enquiries to:

Katherine Mitchell

Marketing Services Director, Brandon Consulting Services