Lack of terrorist activity has boosted profits to £509.5m

Profit after tax at Pool Re, the UK’s government-backed terrorism insurer of last resort, jumped almost 244% thanks to a lack of terrorist activity during the year.

Pool Re made a profit after tax of £509.5m for the year ended 31 December 2009, compared with a profit of £148.2m in 2008. As a result, the accumulated balance on the profit and loss account available to meet future claims increased 17% to £3.5bn at the end of the year, compared with £3bn at the end of 2008. Financial assets at the end of 2009 stood at £3.7bn, compared with £3.2bn in 2008.

Gross written premium fell to £315.4m from £320.8m. Number of members, which Pool Re considers a key performance indicator, fell to 252 in 2009 from 266. The company does not consider the reduction a material issue.

Pool Re warned that although claims experience continued to be good, the threat of terrorist attacks remains. It pointed out that the UK government had changed the assessment of threat level back to ‘severe’ from ‘substantial’ in January 2010 following the events of Christmas 2009.