There is no doubt that the terrorism and political violence risk environment has arguably become more complex than it was before.
ACE Insurance Limited, Chubb Group’s South Africa subsidiary recently launched a multinational political violence and terrorism insurance solution for businesses in South Africa with both domestic and international operations.
A Q & A session
FAnews spoke to Chris Caalsen, Property Underwriter at ACE Insurance Limited, South Africaabout this new offering and what makes it unique to the market.
1. ACE has the local knowledge and underwriting expertise to provide companies with financial security against political violence. What makes your product offering unique?
Apart from the standard perils that most traditional terrorism products cover, ouroffering includes covers such as bomb hoax threat, contingent business interruption extensions and cover for both the premise that suffers the loss and the dependent’s premises.
Coupled with the unrivalled strength of the Chubb network globally and the expertise and experience of our dedicated underwriting team, clients can rest assured that they have access to state-of-the-art coverage options for this constantly evolving and challenging risk.
2. Political violence remains a constant threat which is by its very nature difficult to predict and to mitigate. Is it challenging to offer industry-leading limits of cover on a flexible basis to match the client’s requirements?
Terrorism and political violence risk has certainly evolved, particularly over the past five years.
The Paris terror attacks in November 2015 and the latest Brussels terror attack are just some of the examples that have highlighted the need for terrorism and political violence cover.
Whilst it has expanded from terrorism-only policies to cover everything from riots to civil war, insurers constantly need to adapt their products to cater for these evolving risks. Globally we have increased our capacities and offer clients additional covers to help them mitigate this fast changing risk.
3. What are the key features brokers can take out of this product?
Our broad range of perils and additional coverage extensions, coupled with our truly multinational capabilities, make ourterrorism and political violence product one of the leading product offerings in the market today.
We are always happy to work with brokers and support them with specialist training events and masterclasses.
4. What exactly is covered by the product?
The ACE Terrorism and Political Violence Plusproduct covers a broad range of perils including:
• Terrorism cover (standalone or packaged with perils below);
• Riots, strikes, civil commotion and malicious damage;
• Insurrection, revolution, rebellion, coup d’etat and mutiny; and
• Comprehensive political violence, including war and civil war.
Additional coverage extensions include:
• Looting and pillaging;
• Terrorism liability;
• Contingent business interruption (CBI) extensions (denial of access, customers and suppliers, public utilities); and
• Bomb hoax.
5. What is not covered which might be misconceived as something typically covered in this type of product?
In line with the rest of the commercial market, with regards to South African and Namibian risks, a ACEpolicy will not respond if South African risks have South African Special Risk Insurance Association (SASRIA) in place – the SASRIA policy will respond first.
Terrorism policies are often purchased as a contingent protection for cover that SASRIA/NASRIA might exclude. For example; certain extensions under the business interruption sections are not covered by SASRIA.
6. Are there any territories that you do not cover?
Some territories obviously pose greater challenges than others, but each risk is judged by its specifics, such as exact location, industry and so on, and considered in accordance with the Chubb Group’s underwriting philosophy.
7. Are cyber-attacks included in this cover or is that a product on its own?
Damage or loss following a cyber-attack is specifically excluded from the product. However, ACEdoes offer a stand-alone cyber offering with customised risk solutions and a global network of cyber risk specialists.
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