A new report commissioned by the UK’s government-backed mutual terrorism reinsurer Pool Re has found that only 19% of UK firms have a terrorism insurance policy in place, a figure which the company says indicates a widespread lack of attack contingency planning among the country’s businesses.
The uptake of Small to Medium sized Enterprises (SMEs) were found to have been even lower at 15%.
33% of respondents to the survey say the biggest barrier to purchasing this kind of terrorism insurance was the low probability of it being claimed upon.
In response to these findings, Pool Re has launched a compact guide for business owners explaining why businesses need to think about insuring themselves against property damage and business interruption resulting from a terrorist attack.
The Counter-Terrorism and Border Security Bill 2018, which was granted Royal Assent in February, made Pool Re the first terrorism reinsurance pool in the world to extend its cover to non-damage business interruption losses.
Previously, Pool Re was only able to reinsure losses incurred if a company’s premises had been physically damaged by terrorists.
However, Pool Re states that they remain at risk of financial loss unless businesses take the step to purchase terrorism insurance.
“These figures demonstrate the knowledge gap on terrorism insurance that UK businesses must address to ensure we are as resilient as possible to the secondary effects of terrorism,” said Julian Enoizi, Pool Re’s Chief Executive Officer.”
“The compact guide for business owners that Pool Re publishes today is a key part of closing this gap, and we will also be embarking on a collaboration programme with business federations, local authorities, brokers and insurers.”
“We aim to promote the broadest possible take up of terrorism insurance policies, and thus help UK businesses be better protected from damage to their business should the worst happen.”