Terrorism Insurance – Are you covered ?

The bombing of the Baltic Exchange buildings in the City of London in April 1993, estimated to have cost the insurance industry over £250 million, led the insurance market, without support from their reinsurers, to withdraw cover for property damage by terrorism. The insurance industry found a solution however and the Pool Re Insurance Company was established with the backing of the UK Government. Since 1993 Pool Re has been the main provider for terrorism cover for the vast majority of commercially insured buildings throughout the UK and in particular for ‘high-risk’ properties in City Centre locations and for other ‘target risks’ such as Airports and Shopping Centres. Cover is available from Pool Re via the insured’s main insurance carrier (as a member of Pool Re) at an annual premium cost that is separately chargeable.

As an alternative to arranging terrorism cover via Pool Re, other facilities, mainly supported by Lloyds Underwriters are available. These alternatives, sometimes at a cheaper premium, often with a loss limit applicable can have the benefit of providing cover for specific locations rather than for all locations as required by Pool Re.  Unlike Pool Re however, cover for damage as a consequence of terrorism by a Nuclear, Radiological, Biological or Chemical attack is often not readily available.

The likelihood of a ‘dirty bomb’ seems unthinkable but none the less the threat remains. Terrorism is now a global phenomenon and the prospect of further terrorist attacks in the UK remain ever present. The recent events in France and Belgium have further served to heighten our awareness.


For Residential Management Companies with a responsibility to insure their Apartment Blocks and for Commercial Property Owners and others such as leaseholders, the requirement to insure against damage by terrorism will often be stipulated under the terms of any lease or as a condition of finance with a bank. The prospect of not insuring damage by terrorism could be considerably costly.


Bridge Insurance Brokers Limited are specialists in blocks of flats insurance via their specialist FlatGuard facility


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