August 2002

Terrrorism cover - Update on Pool Re

The Insurance aftermath of the terrorist attacks in New York and Washington on 11th September 2001 forced re-insurers and direct insurers to reappraise their exposure to the risk of terrorism. This has led the Government to announce that the remit of Pool Re wil be extended to enable Insurers to offer terrorism cover against a wider range of perils.

Background

Up to 11th September 2001 terrorism exclusions within insurance policies in the UK were usually limited to property policies. They were based on the Terrorist Act 1993 and designed to deal with the IRA bombing campaign on mainland Britain. Fire and Explosion were excluded by insurance companies but were provided for under the Pool Re scheme.

The atricities on the scale of New York and Washington led to the need for a revision in the Pool Re arrangements.

The changes include: