Terrorism risk highest in Europe: ReportPosted On: Sep. 26, 2017 12:08 PM CST
Data from Pool Reinsurance Co. Ltd., the U.K.’s terrorism insurance backstop, shows that two-thirds of terrorism attacks last year occurred in Europe, including Turkey.
Nearly half of those attacks, which excludes acts of insurgency or war in areas of conflict, were directed at police, military and government targets, according to Pool Re’s Terrorism Threat & Mitigation Report released Tuesday.
The government-backed reinsurer said the data in the report, which has been expanded this year, will be used by its Terrorism Research and Analysis Centre to model and price terrorism reinsurance coverage. While the report did not contain detailed data on attacks in 2017, it noted that the United Kingdom saw a wave of attacks in the first half of the year.
Terrorism is more difficult to model than other risk, such as natural catastrophes, due to the lack of historical data and human influence, said Steve Coates, chief underwriting officer at Pool Re in London.
But the data in the report "will give others and Pool Re a better view of the risk and influence how we price and model our cover and the reinsurance cover that we'll buy externally," he said.
Of the attacks in Europe last year, 72% occurred in Turkey, where Kurdish separatists escalated their terrorism campaign.
Worldwide, there were 115 terrorist attacks in 2016. The attacks killed 779 and injured 3,044, according to the report. About 25% of the attacks resulted in property damage, with attacks involving improvised explosives devices, or IEDs, being the most likely to cause property damage.
In mainland Europe, the most common method of attack was with knifes or other bladed weapons, which accounted for 47% of attacks.
“France and Germany were the most attacked mainland European countries in 2016. This is likely to be due to the countries’ involvement in military intervention in Iraq and Syria,” the report said.
In the first half of 2017, there were 37 attacks resulting in 114 deaths and at least 370 injuries in Europe, including Turkey, the report said. The attacks included the bombing outside the Ariane Grande concert in Manchester, England, in June, which Pool Re previously disclosed resulted in claims for the reinsurer.
In the United Kingdom, “the frequency of attacks and the range of methodology used in them this year has now surpassed a single period of intensity and represents a clear and defined escalation of hostilities,” the report said.
Pool Re was established in 1993 by the U.K. government and insurance industry, and its members include most insurers and Lloyd’s of London syndicates that offer commercial property insurance in the United Kingdom. Earlier this month, it received preliminary government approval to extend its coverage to include cyber terrorism and it is in discussions with the U.K. government to also include nondamaged business interruption coverage.