The International Group (IG) has finalized the structure of its Pooling and Group Excess of Loss Reinsurance (GXL) contract for the 2025/26 policy year, addressing evolving risks and claims trends.
This year’s renewal process reflected an uptick in pool claims activity, returning to levels observed between 2019 and 2021. Contributing factors included an active hurricane season and notable incidents such as the Baltimore Bridge loss.
The GXL program provides extensive coverage, including unlimited protection for most insured risks. The structure for the 2025/26 policy year retains a three-layer format covering US$2 billion in excess of US$100 million.
Individual Club retention has been maintained at US$10 million, with claims between US$10 million and US$100 million pooled among IG Clubs. The first layer covers US$650 million in excess of US$100 million, 25% of which is provided by three private placements, while Layers 2 and 3 cover US$750 million in excess of US$750 million and US$600 million in excess of US$1.5 billion, respectively. These higher layers are fully covered by the open market.
Coverage for pandemic and cyber risks remains free and unlimited up to US$650 million in excess of US$100 million. For claims between US$750 million and US$2.1 billion, two separate aggregate towers provide US$1.35 billion in annual coverage for each of these risk categories.
Hydra, the IG’s Bermuda-based reinsurance captive, maintains an Annual Aggregate Deductible (AAD) in Layer 1. For 2025/26, the AAD remains at US$107.1 million, consistent with the previous year.
The IG’s Reinsurance Committee reviewed vessel categories and adjusted rates based on historical claims data. Fully cellular container ships (FCC) faced the most significant rate increase, rising by 23.6%. Clean tankers saw an 8.9% hike, while other vessel types, including persistent oil tankers, passenger ships, and dry cargo vessels, experienced smaller adjustments.
Excess war protection and indemnity (P&I) coverage has been renewed for 12 months. However, reinsurers continue to exclude coverage for risks in Russia, Ukraine, and Belarus due to the ongoing conflict. To address these exclusions, the IG has purchased US$100 million in aggregated sublimited coverage for risks associated with these regions.
Mike Hall, chairman of the IG’s Reinsurance Committee, acknowledged the complexities of this year’s renewal.
