Broker completes abandonment and cancellation cover
Aon Benfield, the world’s premier reinsurance intermediary and capital adviser, has completed the cancellation and abandonment insurance programme for the 2014 Winter Olympics in Sochi following a string of successful Games placements.
The programme is part of a revolving facility which rolls forward from one Games to the next; the company has previously placed cover for the 2006 Winter Olympics in Turin, the Beijing 2008 Olympic Games, the 2010 Winter Olympics in Vancouver and the London 2012 Olympic Games.
The Sochi programme, which, as with past events, indemnifies the International Olympic Committee (IOC) against cancellation and abandonment of the Games, is more than double the size of any other programme currently placed in the contingency market.
It required extensive natural hazard modelling – particularly that of earthquake and snowstorm – undertaken by Aon Benfield Analytics, who worked closely with the company’s Structured Solutions team to structure the deal.
The transaction utilised capacity from the London, Continental Europe, and Bermuda reinsurance markets.
Hugo Raymond, a member of Aon Benfield Structured Solutions, who has led the placement process, commented: “Previous Games were always placed on an individual basis, but Aon Benfield secured cover for future Games as part of a rolling programme, the hallmark to the success of this facility.
"For such a large placement, we couldn’t just rely on the standard contingency market; we had to combine their expertise with that of the property catastrophe market.”
Grahame Chilton, vice chairman of Aon Group, added: “Our involvement in the Olympics account is a matter of tremendous pride for Aon Benfield. We value our longstanding relationship with the IOC, and we look forward to continuing to provide the very best in analytical services and expertise in order to transfer this complex risk into the global insurance and reinsurance marketplace.”