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UK insurers launch reinsurance facility for cladding‑affected buildings awaiting remediation to expand capacity and cut leaseholder premiums; FCA backs scheme, ABI urges government support and IPT relief

Published on: 15 March 2024

Published by a Law360 reporter
Legal News
Article summary

Fire safety reinsurance facility

On 13 March 2024, the Association of British Insurers (ABI) announced that a fire safety reinsurance facility aims to expand insurers’ capacity to cover buildings pending remediation, while stimulating competition to draw more providers into the market. It is intended to bolster available capacity and encourage wider participation across the market. The facility, arranged by McGill and Partners, is due to go live on 1 April 2024. It has backing from the ABI and the British Insurance Brokers’ Association and was created in the aftermath of the Grenfell disaster, when a high-rise residential block burned for 60 hours, resulting in 74 fatalities. The building’s external cladding contributed to the fire’s spread. Steve McGill, founder and chief executive of McGill and Partners, noted that insuring cladded, multi-occupancy properties presenting fire safety risks has long tested the sector. Yet the facility is intended to offer a competitive market solution that will...

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