Up to $1.12 billion in damages from the series of terrorist explosions that rocked Brussels Tuesday will be covered by a terrorism insurance pool set up by the Belgian state and private insurers.
The eight-year-old Terrorism Reinsurance and Insurance Pool is funded by insurance companies and backed by the Belgian government, much like the terrorism program in the United States. Roughly 95% of insurers operating in Belgium participate in the program, the Organization for Economic Coordination and Development said.
Participating insurers retain about $337.3 million, and the entire pool is covered by a stop-loss reinsurance policy underwritten in the London, Continental European and Bermudian markets. It pays for losses proven to result from terrorism up to just over 1 billion Euros, or $1.12 billion per year.
Losses related to Tuesday’s attack are still being calculated after two explosions occurred at Brussels’ Zaventem airport and one at the Maelbeek subway station. The attacks killed at least 30 people and injured at least 230, authorities say.
ISIS has reportedly claimed responsibility for the attacks, and Brussels has been on high alert since one of the suspected perpetrators of the November terrorist attacks in Paris was arrested Monday.
All public transportation in Brussels was shut down following the attack, including all flights to and from Brussels Airport.
The largest terrorist attacks have resulted in insured property losses far greater than the amount insured by the Belgian pool. The September 11, 2001 attacks on the East Coast of the US caused isured losses for more than $25.12 billion and the 1993 bombing of London’s NatWest tower cost insurers $1.21 billion.
In the US, there is no word whether national insurance companies will be affected by the Brussels attack. However, insurers are expecting a surge of insurance inquiries regarding travel coverage.
Stan Sandberg, co-founder of trip insurance comparison website TravelInsurance.com, has said travelers heading to Brussels can no longer purchase cancellation coverage.
“TravelInsurance.com reminds customers that travel insurance plans are designed to protect against unforeseen circumstances,” Sandberg said.
He said most plans purchased that include trip cancellation for terrorist attacks will applied to travelers scheduled to go to Brussels within seven to 30 days of the attacks. Those headed to Brussels should contact their insurance providers to see if they have coverage, as some carriers provide coverage within a radius of 50 miles.
