One third of UK firms lack terrorism cover, says report

More than one third (36%) of UK corporates do not have specific insurance cover in place for terrorism and political violence risk, according to research by ACE.

Furthermore, more than one in 10 respondents (13%) believe that terrorism and political violence are covered under another policy.

The findings come from ACE’s new guide, ‘Property Insurance: Terrorism and Political Violence’, which will be launched at the Airmic annual conference this week.

Produced in conjunction with Airmic, the guide explains and explores the nature and extent of terrorism and political violence threats. It offers guidance on how to secure the necessary insurance to transfer some or all of these exposures.

In clarifying how various coverage options respond to certain incidents, the guide aims to remove ambiguity, and help risk managers to be clear on what is insured under each type of policy. It also contains definitions for key terms relevant to terrorism and political violence cover.

In addition, the guide highlights other key areas for risk managers and insurance buyers to consider, such as the link between exposure to terrorism and political violence, and the influence it has on supply chain disruption, or business interruption factors caused by “denial of access” following an incident.

ACE terrorism underwriting manager Piers Gregory said: “The terrorism insurance market has developed considerably in recent years, yet many policyholders are still uncertain as to the nuances of terrorism and political violence cover. ACE has developed this guide to help risk managers and provide them with further clarity on the subject, in order to increase financial resilience and peace of mind in terms of these risks.”

Airmic technical director Paul Hopkin said, “Terrorism and other forms of political violence represent an important and fast developing area of risk, and we welcome this guide as a timely reminder of the need for companies to understand their exposures and the insurance protection they have in place.”

ACE conducted the research as part of a larger survey of European corporates, on a range of emerging risk issues, with more findings set to be released in the near future.