Backstop or Bailout
- Topics:
- Insurance
- Tags:
- Business Operations,
- Corporate Insurance,
- Government,
- Homeland Security,
- Insurance,
- Reinsurance,
- Treasury & Risk Management
- Source:
- Treasury & Risk Management
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Overview: This paper explores the government-backed reinsurance facility to absorb the brunt of financial losses from another mega-terrorism incident like Sept. 11. The World Trade Center attack caused an estimated $38.2 billion in losses for the U.S. insurance industry, a tally that forced some reinsurers to the brink of insolvency and put the entire niche in peril. Unable to purchase reinsurance to spread their risk of loss, commercial insurers simply stopped offering terrorism coverage, essentially forcing companies to bear the risk burden on their own balance sheets.
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Format: HTML | Date: Jun 2002 | Pages: 4
