Brussels authorizes the launch of Flood Re

The European Commission has granted its approval for the launch of the specialized reinsurance pool Flood Re. For the authorities, this entity will not disrupt competition but will offset market shortages.

Flood Re specializes in the reinsurance of flood risks in the United Kingdom, covering in particular the homes of poor families.

Claims are settled through the collection of premiums plus a tax levied on all homeowner’s insurance policies. This tax is expected to raise 180 million GBP (279 million USD).

Flood Re is authorized to get reinsured in order not to weigh on State budget. Guy Carpenter is the designated broker to place this business.