As messages of sympathy continued to pour in from around the world, the global insurance industry began facing up to the daunting task of paying claims on what most observers believe will be the largest insured loss ever suffered.
Initial concerns that statements by President Bush and other political leaders that Tuesday’s attack on the World Trade Center and the Pentagon amounted to “Acts of War,” which might lead to a denial of coverage, have not materialized. Many in the industry have come forward to affirm that terrorist acts are covered by most property/casualty policies, and that claims will be paid.
Candysse Miller of the Insurance Information Institute office in Los Angeles explained that war exclusion clauses were invoked only in the case of a declared war between two countries.
Chubb Corp. announced that it had already begun to pay claims resulting from the attacks and that the war exclusion clause did not apply.
While everyone in the industry agrees that there will be huge losses, it’s still impossible to calculate any reliable figures. A number of companies have given preliminary estimates of the exposures they may face, but have cautioned in each case that the eventual amounts paid could be higher or lower.
Until more is learned about the circumstances surrounding the attacks, who the victims were, the nature and extent of the damages and the coverages involved, it will be impossible to accurately estimate the extent of the losses, but whatever they might eventually turn out to be the insurance community has maintained a solid commitment to pay them.
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