Terrorism Risk Insurance in OECD Countries

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This book presents OECD policy conclusions and leading academic analysis on the financial management of terrorism risk nearly four years after the World Trade Centre attacks. It examines how the insurance market reacted after the 9/11 attacks, financial market solutions for terrorism risk, and possible roles for governments in the coverage of terrorism risk. It includes a table comparing terrorism insurance schemes in various OECD countries as well as an analysis of terrorism coverage in South Africa, Israel, and India.



Policy Issues

With a considerable number of acts of national and international terrorism recorded in the last thirty years2, terrorism was certainly not an unknown exposure for insurers before 2001. Private insurance covered most terrorism risks, which were viewed as a manageable exposure. Terrorism risk insurability was only an issue in a few countries historically highly exposed to terrorism, and mainly Israel, South Africa, the United Kingdom and Spain3 – where governments had decided to step into the terrorism compensation process, although to various degrees.


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