24th November 2017


Sadly, terrorist attacks have become part of our everyday lives. The terrorist bombings in the 1990’s causing property damage have changed to one where public safety, panic and fear is the desired outcome.

Whilst it is widely accepted that business centres and major cities are considered high risk, it is prudent for those in rural areas to also consider the risk. Splinter groups and lone wolf terrorists can reside anywhere in the UK, the risk of explosion in transit or by accident is a genuine threat.

Traditionally, terrorism insurance has been procured through Pool Re, a government guaranteed scheme set up in 1993 after the IRA bombing in Manchester caused catastrophic losses (c.£400m) to the insurance industry. Over recent years however, we have seen many businesses consider the benefits of placing their cover outside of the established route.

A viable alternative to Pool re?

As insurers understand the economic impact of such events a popular alternative has emerged. With a host of insurers opting to operate outside of the pool, we have seen a cost-effective and flexible option for many businesses.

A broader definition of Terrorism that contains individuals acting alone, in addition to those connected to an organisation which is seeking to influence or overthrow the UK Government, including acts of Sabotage. This policy also does not require the Government to officially declare an incident as an ‘Act of Terrorism’ before they will admit liability. This helps speed up the claims process.

Selection – Pool re have an all or nothing principle, the alternative markets enable you to opt to cover only those location that you select, offering you flexibility and choice

Overseas – whilst Pool re is restricted to UK only, if you have overseas locations you able to procure a policy that covers your risks, worldwide. A single policy that covers all your risks worldwide, The alternative markets do however have limitations, Pool re will provide response in the event of a nuclear, biological, chemical or radioactive attack that most alternative covers will opt to exclude.

With premium savings of anything up to 50% cheaper the emerging alternative products in this sector should be given due consideration.

If you would like to discuss your options when procuring terrorism cover please start a conversation with us.