Pool Re has today published its latest Terrorism Frequency Report, which looks at terrorism trends and reinsurance in advanced markets spanning the 25 years since its foundation – including recent attacks such as in Salisbury.
The report, which coincides with the government-backed reinsurance pool’s quarter-century anniversary, provides “an insight into the shifting nature of the terrorist threat,” looking at the frequency of attacks, the changes in methodology, and the financial impact of the property damage caused.
It also reviews recent terrorist attacks across the globe, including an assessment of the attack against Sergei and Yulia Skripal in Salisbury, and the “coverage gap” revealed in its wake.
The IRA’s mainland bombing campaign and the events that led to Pool Re’s foundation are discussed in an article written by Andrew Silke, the newly-appointed Pool Re and Cranfield University professor of terrorism, risk management and resilience, and the implications for the insurance market and counter-terrorism police as a result of the intensified threat posed by modern extreme right-wing terrorism are reviewed in the report.
Pool Re’s chief executive Julian Enoizi said that the scheme and threat which Pool Re was established to mitigate has “changed markedly” in the 25 years since its creation.
“We have sought to continuously evolve our proposition and to learn from our experience of terrorism risk in an effort to develop analytical and actuarial tools,” he said.
“By assessing the libraries of data available, in collaboration with our academic partners, from a (re)insurance standpoint and then distilling this information we aim to provide a resource which will enable the market to retain ever more of this risk. The analyses in this report are a significant step towards that goal.”
Enoizi said that events which point towards an emerging risk must also be analysed, pointing to the Salisbury attack.
“The losses being suffered by businesses in Salisbury are highly unusual. CBRN has historically been excluded from all commercial property and business interruption insurance policies as it was thought that the sheer magnitude of the potential losses would exceed the ability of insurance and reinsurance companies to meet claims. However, the disturbing event in Salisbury shows that these types of attack can be localised and could be deployed by criminal or terrorist actors,” the CEO said.
“They have highlighted the macro consequences of a micro CBRN event. This should prompt debate within our industry. Consideration should be given to whether the perceived wisdom around certain perils needs to be reassessed and whether now is the time to address other risks, for which underwriters also do not provide cover.”