Insurance bosses have called for the state to step in to meet the cost of future pandemics because the industry will never be able to cover the losses inflicted by viruses like Covid-19. 

The market for pandemic insurance is failing as insurers are unwilling and unable to meet the surge in requests for cover received in the past month, experts warned. 

三级成人视频The chief executive of one London-listed insurer said: “People are asking [for pandemic cover] but nobody’s getting it.” 

三级成人视频“We are always happy as insurers to take uncorrelated events. The whole theory of insurance is that the losses of a few are paid for by the many. The stresses come where – like today – many people have losses and there are not enough unaffected people [to pay for them].”

三级成人视频Steve McGill, former President of Aon and now chief executive of Warburg Pincus-backed boutique broker McGill and Partners, said: “The potential scale of losses created by situations like a pandemic... could overwhelm the insurance industry.”

Responding to the need for pandemic insurance is “a question not just for the insurance and reinsurance industry but for governments”, he said. “A broad-based solution would probably need to come from a combination of government support with the support of the insurance industry, just like what happened with terrorism after 9/11.” 

三级成人视频Unlike epidemics – outbreaks limited to specific regions, of which there are close to 200 a year – pandemics such as Covid-19 spread globally meaning insurers cannot use premiums in one country to pay out on claims in another as happens for extreme weather events.

The state already supports some hard-to-insure markets such as terrorism, through a mechanism known as Pool Re.

三级成人视频Under Pool Re, insurers pay a portion of premiums received into a shared pot that can be drawn on to pay claims. This pools risk among insurers to avoid a single player being overwhelmed by claims. The state supports Pool Re in the event of terror-related claims too big for the vehicle to meet.

三级成人视频The problem could also be partly addressed by standalone pandemic policies with a fixed payout, sources said.

Kurt Cripps, head of innovation at Aon, one of the world’s largest brokers, said insurers could use public data on the number of deaths inflicted by a pandemic to trigger an automatic fixed payout on such policies.

This would get money into the hands of affected businesses faster than traditional policies which require loss adjusters to carry out time-consuming assessments to calculate the value of any payout, he said.

三级成人视频Insurers have come under fire for refusing to pay out on the vast majority of claims by businesses because their policies either do not cover pandemics or cover only named diseases. Covid-19 was not named on policies because it is new.

The call for state intervention comes as British insurers face pressure from the Bank of England to halt dividend payments三级成人视频 and director bonuses until the coronavirus crisis is over.

Last Friday, Legal & General became the first major player to defy Threadneedle Street by announcing it intended to go ahead with a £753m shareholder payout.