Pool Re and BIBA launch terrorism insurance guide for brokers and SMEs

The British Insurance Brokers’ Association (BIBA) and Pool Re have collaborated with a number of government departments and other industry experts to launch a new guide on terrorism insurance. It is designed to improve brokers’ understanding of this fast-growing risk class and boost sales of this line of insurance among small and medium-sized enterprises (SMEs) in the UK. Pool Re was launched in 1993, largely as a result of attacks on the UK mainland by the Irish Republican Army. Since then, the terror threat has changed dramatically, explained BIBA, which is holding its annual conference in Manchester this week. BIBA pointed out that businesses and the public now face a much more diverse range of threats, including ‘lone-wolf’ attacks, potential use of chemical and biological agents, cyberattacks and the weaponising of vehicles. “No longer can businesses expect to escape the effects of an attack just because they are not located in a high-profile building or a major city,” said the brokers’ association. The take-up of widely available terrorism insurance remains surprisingly low. Less than 3% of SME businesses buy any terrorism cover at all, noted BIBA. “The new BIBA guide highlights why terrorism insurance is important to businesses and will enhance understanding of the risk of terrorism, helping insurance brokers to help their clients make an informed decision about the insurance protection they need,” added the association. The guide provides brokers with key information about Pool Re and other insurance providers, and the different types of terrorism insurance that are now available to businesses. It also provides tips and advice on how a client can assess their vulnerability and build resilience into their business to complement the cover. One important recent change in the cover provided by Pool Re has been the addition of non-damage business interruption (NDBI) to its core offering. The UK Counter-Terrorism and Border Security Act allowed Pool Re to add NDBI and thus closed a “significant terrorism insurance gap” for UK business, providing them with confidence that they can continue to trade and provide services after an event, explained BIBA. Graeme Trudgill, BIBA executive director, said: “Now that legislation has enabled Pool Re to extend its remit and expand its cover options to include cyberterrorism, there is more capacity for terrorism insurance. We need to increase awareness of the risks of terrorism to businesses and especially SMEs. Businesses whose trading is affected by an incident can turn to insurance to help them get back on their feet. This guide will play an important part in helping insurance brokers to help companies understand the benefits of terrorism insurance and, in turn, increase the resilience of UK businesses, strengthening the economy.” The Rt Hon Ben Wallace MP, minister of state for security and economic crime, said: “The threat of terrorism is ever present and evolving. The aim of government’s counter-terrorism strategy, CONTEST, is to reduce the risk to the UK, its citizens and interests, so that our people can go freely about their lives with confidence. “This new guide on terrorism insurance will further our joint aims of improving resilience within UK businesses and its citizens. We know that UK insurance brokers, with their close relations to businesses, are well placed to help improve the financial resilience of SMEs in the face of potential attacks,” added Mr Wallace. The guide is being sent to every BIBA member broker and spearheads a wider campaign by Pool Re and the UK brokers’ association to broaden the understanding of terrorism insurance and increase its uptake.

Pool Re and BIBA launch terrorism insurance guide for brokers and SMEs

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