Terrorism insurance

Understanding terrorism insurance

While security forces work extremely hard to make the world safe, a host of tragic events have proved how terrorists can hurt innocent people just about anywhere in the world: Las Vegas, Nice, Florida, London, Japan, Sydney, Jakarta.

Nowhere is completely safe. Terrorist acts are no longer the preserve of militant political activists or aligned with specific religious groups.

An independent, DIY approach has come to the fore, with the weapons of choice becoming more basic: knives, trucks, and vans are now as likely as guns or bombs.

How to transfer terrorism risk   

Terrorism isn’t a risk that can be transferred but the some of the commercial consequences can. The effects of these attacks can cause property damage, loss of income, bodily injury and death, loss of attraction, loss of reputation, loss of key personnel… the list goes on. 

Use an experienced broker to get you the right cover that’s ready to stand strong when you need it most. 

There are various ways to insure against terrorism, with some subtle differences. Often terrorism would not be covered under your usual portfolio of insurances. 

Speak to Howden about rationalising your risks and aligning them to insurance that’s effective when you need it.

What does terrorism insurance cover? 

Terrorism insurance covers against loss or damage to the insured property and the ensuing loss of income, with various extensions depending on the nature of the attack (for example, assailants’ motivations and allegiances can sometimes define how claims are processed).   

This is where using a highly experienced broker comes in: we’ll help you get quality insurance that responds when it matters, designed for your unique situation, at a cost-effective price.  

Policy building blocks

We have access to a range of insurers who provide reputable cover for terror-related events. Policies include different clauses, but all broadly fit into these three categories. 

Terrorism insurance 

Covers against loss or damage to the insured property and the ensuing loss of income caused by acts of terrorism and sabotage.

Political violence insurance 

As above, this policy provides cover against loss or damage to the insured property and the ensuing loss of income caused by acts of terrorism and sabotage, with certain extensions. 

This type of policy extends cover to:

• Riots, strikes and/or civil commotion
• Malicious damage
• Insurrection, revolution or rebellion
• Mutiny and/or coup d’etat
• War and/or civil war
• Counter-insurgency

Active assailant insurance 

With the change in terrorist tactics, many attacks do not manifest in property damage.  For instance, the attacks in Nice and London resulted in severe bodily injury and minor property damage.

These types of policy cover loss of income (including property damage) following an active assailant event where the attack is premeditated, a weapon is used (including a vehicle) and three or more persons are injured. Cover can be designed to include the following:

• PR consultancy expenses 
• Relocation expenses 
• Counselling and psychiatric care 
• Medical expenses 
• Job retention costs / recruitment costs
• Additional security measures 

Insurances related to terrorism cover:
 

Loss of attraction

A type of business interruption cover where the insured is affected by a terrorist event on a defined region.

Kidnap & ransom

Provides an expert crisis response team to spring into action in kidnap and ransom situations.

Crisis response insurance

Provides an expert response to situations such as natural disasters and political upheaval.