An explosion that injured 15 people at the Bombay Bhel restaurant in Mississauga last week has once again brought the topic of insurance coverage to the fore.
Shortly after 10.30pm on Thursday (May 24), an “improvised explosive device” was detonated inside the restaurant, leaving three people with serious injuries and 12 with minor and superficial injuries. Those injured in the blast ranged in age from 23 to 69. They were all treated and released from hospital within 24 hours, Peel police announced.
While police currently have no evidence to suggest the bombing was an act of terror or a hate crime, this incident does raise questions about the threat of terrorism and violence at hospitality institutions and businesses like restaurants, bars, movie theatres and so on.
“Terrorism is a very unpredictable and indiscriminate risk. A terrorism event can happen anywhere and at any point in time, which is why it’s vitally important for businesses of all sizes to consider affirmative terrorism insurance coverage,” said Adam Posner, senior underwriter for terrorism & political violence at Allianz Global Corporate & Specialty (AGCS).
“The perception of terrorism risk is quite low in Canada (at about 33%), compared to the US where the risk of terrorism is perceived to be higher. There are always going to be people who think they don’t necessarily need the coverage or don’t perceive there to be a threat at all.”
Businesses of all sizes have exposures to terrorism and political violence. In recent years, terrorists seem to have changed their target focus - from iconic buildings to more indiscriminate locations where people gather, such as diners, entertainment venues or shopping streets.
For smaller businesses in these indiscriminate locations, the repercussions of a terror-related incident could be much more significant than they might be for a larger organization – especially when it comes to business interruption. A big corporation might be able to mitigate the risk by having business contingency plans and alternate business locations, whereas a single-location small business unit may struggle to get back up and running.
“Of course, there are things businesses can do up front to prevent damage and mitigate terror-related risks, such as: employ security guards, install CCTV, place barriers outside the building to stop vehicle ram raids, and so on. Ultimately, it’s very hard to prevent a terrorist attack, but businesses can mitigate an attack’s impact through terrorism insurance,” Posner told Insurance Business.
“Another thing for businesses to consider is that even if they’re not the direct target of an attack, they may still get caught up in an attack’s repercussions. If a terrorist detonates a bomb in a shop on a main shopping street, the whole area will likely be closed down for the authorities to carry out an investigation, causing denial of access issues and business interruption losses for businesses in the immediate vicinity. Purchasing terrorism insurance coverage and broadening out that coverage to cover business contingency expenses is really important for small businesses.”
