Brokers need to cut the “gobbledygook” and speak to clients in plain English about terrorism cover, says Geoff Stillwell, founder of
Beech Underwriting Agencies.
Terrorism is a notably difficult topic to understand and discuss. Many choose to overlook terrorism cover and justify this by citing low risk probability. However, we can never know where terror will strike next.
“A lot of people don’t want it,” Stillwell told Insurance Business. “They don’t see it as a necessity. It’s not necessarily required on everything but certainly where you have restaurants, pubs, entertainment and hotels - they should really be looking at having terrorism coverage with non-damage denial of access.”
The terrorist attack in London Bridge on June 03 left some businesses at loggerheads with their insurance companies.
Borough Market’s Arabica Bar & Kitchen was hit with a £50,000 bill after its insurance company rejected its claim for business interruption. Arabica’s coverage did not include non-damage denial of access as a result of terrorism.
Beech Underwriting Agencies offers non-damage denial of access coverage as an extension to its primary terrorism coverage for as little as £75. Some insurers will only offer coverage when actual physical damage is caused, Stilwell claims.
“We need brokers to educate clients and give them the choice of buying either a Pool Re policy or a Beech Underwriting policy. They should put the choice to the client who will then get what they pay for,” said Stillwell.
“On this policy you’ve got non denial of access coverage and on that one you haven’t. The client must be able to make an educated choice.”
Terrorism coverage is particularly important for properties paid for via a mortgage or loan, he states.
“Any broker should stress to their client that whether it’s household or residential, if there is a mortgage or a loan on the property, they need terrorism cover,” Stillwell noted.
“If there is an incident and the property is destroyed, the mortgage company is still going to want to be paid whether there is a building there or not. You may have the land but who is going to pay for the new build when you have got no money coming in from the insurance company?”
Related stories:
Restaurant claim fails after London Bridge terrorist attack
How Manchester and London shook up terrorism insurance
.jpg)
