Hiscox Launches New System for U.S. Terrorism Insurance

October 14, 2002

London-based Hiscox Plc, which operates in both the Lloyd’s and specialty lines markets, announced the launch of a unique broker “extranet system” to provide solutions for U.S. clients requiring terrorism cover of up to $25 million per building.

“The Hiscox Terrorism Insurance Extranet system delivers instant quotes and policies for US terrorism insurance business, providing cost effective insurance cover through major UK brokers and US partners,” said the bulletin.

The company indicated that it has offered such coverage for 25 years and is stepping up its efforts in light of the problems many clients are having in obtaining policies which cover terrorist acts.

It described the key elements of the coverage as follows:
* Up to $25,000,000 limit per building on a full value basis
* Nil physical damage deductible
* Only 7 day business interruption deductible
* Automatic aggregation which allows Hiscox to monitor its exposure in any one geographic area
* Plain English policy wording
* Physical damage and business interruption insurance offered as stand alone cover or as a combined policy
* The Terrorism Insurance Extranet system provides online policies within ten minutes and is expected to be adopted by a number of brokers in the US.

Hiscox’ announcement is eerily prescient, given the apparent upsurge in terrorist activity. The company noted that it’s “become a fact of life,” and stressed that businesses of all sizes and types now recognize that they don’t have to be the “actual target of an attack to suffer damage, loss and interruption to their ongoing business, regardless of their location.” The company also offers its clients the services of Control Risk Group in studying vulnerable areas in order to minimize risks.

Rob Childs, Hiscox’ Director of Underwriting, commented that, “Changes in the US terrorism insurance market post September 11 have resulted in a noticeable and worrying gap in cover for middle market US business. We are particularly pleased that our experience in the UK and other terrorism insurance markets has meant that we’ve been able to provide a product to meet this insurance need in the US market.”

“The key thing for brokers is that our new extranet service gives them
instant access to capacity for Terrorism insurance and then also allows them to offer their clients a very clear and straightforward policy wording,” Childs continued.”That clarity of cover for the client, and ease of use for the broker, offers a simple solution to finding cover that has previously been hard to source.”

Hiscox noted, however that certain Major metropolitan areas including the downtown and city center areas of Chicago, Houston, Las Vegas, Los Angeles, Miami, New York, San Francisco and Washington DC were excluded from coverage. It explained that the exclusions of these areas were necessary in order to “enable the service to work effectively and to keep the cost of premiums down.” It also excludes chemical and biological terrorism, cyber terrorism, hoax or threat of terrorism and nuclear attacks.

For further information on the extranet service contact your London broker or e-mail: david.guest@hiscox.com for a broker recommendation.

Was this article valuable?

Here are more articles you may enjoy.