Iran trading: P&I cover update - increased limit of fall-back cover

IG Circular

Published: 14 April 2016 Updated:

Circular issued by International Group clubs

Update January 2017

The International Group has now completed the placement of the reinsurance programme for the 2017/18 policy year. In view of the continuing application of primary sanctions, US domiciled reinsurers will no longer participate in the reinsurance programme. There is therefore no need to extend the fall-back cover beyond 20 February 2017.


Members are referred to our previous circulars ending with the circular published on 19 March 2016 regarding the placing of fall-back cover.

As notified in that circular, the International Group has bought "fall-back" cover, which is designed to respond to reinsurance recovery shortfalls that would result from the inability of US domiciled reinsurers on the Group GXL and Hydra reinsurance programmes to make payments due to the continuing application of US primary sanctions, for the 2016/17 policy year.

The Group has now been able to obtain a higher limit of cover (€100million) compared to that which was available initially (€70million) and further secured underwriters' agreement to a second full reinstatement of cover. All other features of the cover remain unchanged.

The Group remains of the view that because of the limitations of fall-back cover, whilst mitigated to an extent by the increase in limit and the additional reinstatement, it does not provide a long term solution to Members' needs. The Group therefore continues to engage with the US administration and a further report will be made in due course.

All clubs in the International Group have issued a similar circular.