Risks Eligible for Terrorism Cover

It is possible to cover most types of commercial property under the scheme: buildings, their contents, site property, construction projects and plant and machinery. It is also possible to cover business interruption losses arising from damage to such property. However, the scheme does not cover property insured under marine, aviation or motor policies and it does not cover property on licensed nuclear sites, for which separate arrangements are in place.

Because the Pool Re arrangements are concerned only with losses which follow from damage to commercial property, it does not extend to life or personal injury. Nor does the scheme protect private property, although it can cover residential property insured by a firm (such as a block of flats owned by a property company).

To be eligible for the scheme, the property must be located in England, Scotland or Wales; it does not apply to property in Northern Ireland, the Isle of Man or the Channel Islands. The property must normally be insured under a general commercial policy issued by a Pool Re member covering conventional fire and explosion damage. Members do not provide terrorism cover under the scheme on a ‘stand-alone’ basis, i.e. in a policy covering terrorism only.

If a policyholder decides to extend their policy to include terrorism cover, they must cover all the property they insure. They cannot use the scheme to insure only part of their property portfolio for terrorism.