AIR has not implemented major changes to its terrorism model since 2007. In 2008, RMS implemented a number of changes in its Probabilistic Terror Model, PTMv2.7. The latest updates to both AIR and RMS terror models are provided below.

AIR U.S. Terrorism Model

In September 2007, AIR, updated its damage functions to include the impact of reflected pressure waves following a conventional bomb blast - following two years of research. Earlier models had only taken account of incident pressure waves. Reflected pressure is always greater than incident pressure by a factor of up to 13X, depending on the density of the area in question. In general, this change to include reflective forces has lead to an increase in projected property losses by city.

Continue reading…

Terrorism coverage impacts aviation insurance around the world. This is particularly prevalent among airlines, which are required to have passenger and third-party liability coverage to receive landing rights and for aircraft leases. The widespread unavailability of aviation insurance because of issues with terrorism coverage could impair the entire industry.

Continue reading…

Namibia

Primary insurance for damage from terrorist acts is provided by the National Special Risks Association (NASRIA). NASRIA was established in October 1987 and has been operational since January 1988, following cancellation of reinsurance facilities previously available to the conventional insurance market for acts of terrorism and politically motivated acts. The Namibian government currently acts as ultimate reinsurer, but the protections to NASRIA’s retention are very conservative in efforts to avoid drastic losses to the government. To avoid gaps in cover, NASRIA includes riot, strike and labor disturbances, which were previously excluded from conventional policies.

Continue reading…

Bahrain

The Arab War Risks Insurance Syndicate (AWRIS) was established in 1981 to provide war cover during the Iran-Iraq War, with an emphasis on defending the insurance companies situated in the Middle East. Based in Bahrain, AWRIS is a syndicate of approximately 110 member insurance and reinsurance companies from 18 Arab countries. The member companies share the retention with quota share and aggregate excess of loss reinsurance placed in London. AWRIS provides insurance for risks under the categories: “War — Cargo,” “Commercial and Aviation Hull,” “Terrorism and Sabotage of Fixed Assets,” “Transported War — Cargo by Road” and “War — Liability.”

Continue reading…

Argentina

There is no terror pool or government involvement in terror coverage. Terrorism is generally excluded for personal and commercial lines.

Brazil

Terrorism risk became a standard exclusion on all property, engineering risks and general liability policies following the events of September 11, 2001. This included both new policies and those that renew on or after November 9, 2001. The few requests for terrorism coverage are handled on a case-by-case basis. Local insurance carriers generally follow the conditions of coverage approved by IRB Brasil Resseguros S.A.

Continue reading…

In 2004, an insurance pool was formed to provide terrorism coverage for personal accident business up to a maximum insured amount of NTD2 million (USD 61,000) per person. This pool is administered by the Non-Life Insurance Association in Taiwan and was created to share terrorism risk for personal accident business among private insurance companies and the Central Reinsurance Corporation in Taiwan. The pool has a cap of NTD1 billion (USD32 million). If losses exceed this amount, claims are paid on a pro rata basis.

Continue reading…

There is no terror pool or government involvement in terror coverage. “Sabotage and Terrorism” (S&T) are excluded on all policies. Reinsurance for property lines exclude S&T, except for large industrial risks where special arrangements have been made. S&T has been issued as an endorsement (if applicable), rather than as a standalone policy.In 1983, the government established a government-sponsored Sabotage, Riot, Civil Commotion (SRCC)/Terrorism Fund to cover strikes, riots, civil commotion and terrorism, after extensive rioting caused overseas reinsurers to withdraw protection for SRCC perils. In 1989, the fund was extended to include terrorism risk. 

Download the report >>

(The report includes all charts and exhibits)

Click here to have articles from this series delivered directly to your inbox.

Choose a region:

• Asia
• Europe
• North America

Download the full report >>

Continue reading…

There is no terror pool or government involvement in terror coverage. The Malaysian government has not enacted terror cover legislation, and it appears unlikely to do so, since it is satisfied with the availability of cover on an extension basis. Prior to January 1, 2002, terrorism was covered on an optional basis for both commercial and personal lines. After January 1, 2002, terrorism cover was excluded from all commercial and personal lines policies. Extensions, however, may be granted. 

Download the report >>

(The report includes all charts and exhibits)

Click here to have articles from this series delivered directly to your inbox.

Terrorism is excluded from all primary insurance commercial lines, and reinsurance is not available locally. However, it is possible to buy a standalone terrorism cover if the reinsurance is available from the overseas market.

Download the report >>

(The report includes all charts and exhibits)

Click here to have articles from this series delivered directly to your inbox.