Treading fine line of modern terrorism
In an age where we live with shifting political ideals and policies, we have to come to terms with the fact that we are living within a new reality when it comes to terrorism. The US, UK and Australia all recently released terrorism alerts for residents living in and travelling to South Africa. The Insurance Institute of Southern Africa (IISA) recently held a forum on terrorism and political violence where a number of industry professionals gave key insights into the times we are living in. When we look at the actions that lead to terrorism properly, we see a bit more truth about South Africa than we care to admit.
The local landscape
Since the release of the terror alerts all of the countries have revised their positions to travel advisories. When the alerts were released, we conjured images in our minds of incidents similar to 9/11 where public property was damaged. But the reality in South Africa is more personal in nature and is aimed at government.
We have, over the past few months, seen that South Africa does have an undercurrent of political violence that often flares up and rears its ugly head. Recent reports by the Department of Higher Education shows that costs of damage to property at universities nationwide during the Fees Must Fall Campaign had increased by more than R100 million, putting the overall cost since October 2015 at R459 million. More recently, service delivery protests in Vuwani and Hammanskraal turned extremely violent.
Thokozile Ntshiqa, Executive Manager: Stakeholder Management at Sasria, gave insight into how such events escalate into serious acts of violence.
A history of violence
Political violence can be seen as terrorism. Think of the actions of the Irish Republican Army during the 70s and the political violence experienced in South Africa during the 80s. Many people around the world saw it as terrorism but the perpetrators of the violence did so to achieve political reformation or emancipation from a system that they felt was inefficient or unjust.
If we think of South Africa’s recent socio political landscape, we see that we are facing a similar problem now. Think of the Fees Must Fall Campaign, the Vuwani and Hammanskraal protests. The people were pushing back against government because their voices opposing governments lack of services, or in the case of the Fees Must Fall Campaign governments stance on free education.
“South Africa can be seen as a hotbed for acts of political violence. Factors which breed this include social inequality, differing levels of governance within society, poverty and joblessness as well as a deteriorating economic outlook for the country,” said Ntshiqa.
Who pays the claim?
We also need to be aware that a fine line exists between politically motivated violence and acts of terror; and it is a line that is often blurred. This was the message presented by Piers Gregory, Global Product Head: Terrorism and Political Violence at Chubb.
There are also different questions that need to be asked when insurance policies react to cases of terrorism/political violence.
He pointed out that when it comes to riots and civil commotion; in practical terms, they can be both political and non-political in nature. So then which policy is responsible for a claim? Is it a Sasria policy (special risks) or is it a conventional policy? An example of this was recently experienced when the auditorium at the University of Johannesburg was burned down.
“Instances of revolution, rebellion and insurrection are conventionally covered under a standard war policy exclusion. However, this can often be an advanced form of civil commotion. Where does one draw the line?” he asked. One only needs to think of the Egypt revolution and Libyan Civil War of 2011 to find truth in this.
“The world has changed a lot in 15 years. Pre 9/11, terrorism extensions were included in property policies by insurers, but it was a very small offering which was offered by only five insurers. Post 9/11 the stand alone market has grown to about 50 insurers and continues to attract more capacity. Pre 9/11 a single peril was typically insured for $2 million; this has now increased to approximately $3 billion per peril,” said Gregory.
He added that global risks are increasing, which leads to an increased demand for products that cover these risks.
From hotbed to breeding ground
Combatting terrorism is becoming a tough task. Perpetrators of political violence are technologically connected and are using platforms such as Facebook and Whatsapp to mobilize combatants to areas of political significance and to areas where there is a small police presence. This was a feature of the Egyptian revolution where the government actually shut down the internet in certain areas in an effort to curtail such organisation.
Because of South Africa’s connectivity and the strength of our telecommunications infrastructure relative to other African countries, Ntshiqa pointed out that South Africa is being seen as a hotbed for terrorism.
Editor’s Thoughts:
While political violence is always regrettable and is never the answer, clients need to be aware of the risks they face and that policies may not respond in the way that they expect. Underinsurance in this area could be a major issue. Please comment below, interact with us on Twitter at @fanews_online or email me your thoughts [email protected]
