When you’re considering insurance for your block, you may wonder whether you need to take out terrorism insurance cover too. Whilst it may be listed as an optional extra, you may actually be required to have terrorism insurance for a number of reasons. It’s important not to dismiss it outright and to make sure you know the facts.
Terrorism insurance and your apartment block
None of us want to pay out more money than we need to, so it’s often easy to ignore all of the extras when we’re taking out a new insurance policy. However, for apartment blocks there may actually be a requirement to hold valid terrorism insurance cover.
Some leases may require that you have terrorism cover, particularly where there is a requirement for a full cover insurance. A requirement for comprehensive cover may well need to include cover for an explosion caused by terrorism.
It’s also important to check whether your mortgage provider requires you to have cover against losses caused by terrorist acts. Many providers have very specific terms and it’s important to make sure you don’t breach these.
Finally, you need to consider the possibility that somebody in your block may pose a risk. Whilst there’s no need for unnecessary panic, unfortunately it’s true that many bomb making factories are found in blocks. So you may just think it worth having the cover to protect your property.
Why isn’t terrorism insurance cover included as standard?
OK, so if terrorism insurance is so important, then why isn’t it automatically included as standard? The simple truth is that it is just too costly for insurance companies to cover as part of a standard cover. Losses caused as a result of terrorist acts tend to be huge. So huge in fact, that special measures have to be put in place to ensure that insurance providers can pay out when a claim is made.
Because of the enormous costs involved in covering against acts of terrorism, insurers and the Lloyd’s Syndicates worked together to set up the Pool Reinsurance Company Limited, also known as Pool Re. In the event of an act of terrorism which leads to huge losses, members of the scheme, such as Deacon Insurance, are able to access pooled funds. Without this scheme, many insurers simply wouldn’t be able to afford to offer terrorism insurance cover as an option at all.
As an extra level of reassurance, in the event that the pooled funds can’t cover massive losses, the pool are able to draw on government funds to meet their requirements.
Terrorism – a brief history
Terrorism dates back hundreds of years. There is some debate as to when the first act of terrorism occurred.
Terrorism may well date back as far as the 1st century, when Jews opposed the Romans occupying Judea.
It may date back to the Gunpowder plot of 1605, when a group of Catholic men attempted to kill King James I and bring an end to Catholic persecution by the English government.
Or, the term terrorism may have been born as a result of the Reign of Terror during the French Revolution. This was a violent time spanning 11 months between 1793 and 1794, when radicals took control, arresting and executing anybody who refused to be loyal to the revolution.
Who protects us today?
The responsibility of protecting us against acts of terrorism falls in the hands of the police and the secret services.
The Police Counter Terrorism Network is an agency dedicated to preventing and investigating terrorism in the United Kingdom. They work throughout the UK and also have officers working with other intelligence agencies around the world.
There are currently three organisations making up the British Secret services – MI5, MI6 and GCHQ (Government Communications Headquarters). Each agency has a slightly different role to play in protecting us against acts of terrorism.
MI5 is responsible for fighting threats specifically aimed towards the UK.
MI6 operates worldwide collecting and collating evidence from foreign shores to protect us in the UK.
GCHQ is part of the team which protects the UK, along with law enforcement and the other intelligence agencies. Working with HMG and industry, [they] defend Government systems from cyber threat, provide support to the Armed Forces and strive to keep the public safe, in real life and online (https://www.gchq.gov.uk/what-we-do).
*This is a collaborative post.