European companies underprepared for terrorism and political risk

The majority of European companies feel underprepared for terrorism and political violence risks, according to research by Ace. Yet despite these concerns, only 7% have fully comprehensive insurance cover in place, while 34% have none at all.

Some 32% of the companies surveyed cited terrorism and political violence as the No 1 concern for their business when asked to choose from a list of six areas of emerging risk that Ace identified as increasingly relevant for 21^st century businesses.

The ‘Arab Spring’ and social unrest throughout Europe were highlighted as probable causes for the survey’s findings. A total of 54% of companies said they felt underprepared to deal with terrorism or political risk and its consequences, yet an astonishing 34% admitted to having no cover in place for either.

In an attempt to explain this apparent dichotomy, Andrew Kendrick, Chairman, ACE European Group said: “The research suggests that companies would welcome more information from their insurance market partners on the changing risk environment and the insurance solutions that are available.”

Piers Gregory, Terrorism Underwriting Manager, ACE European Group, said: “It is notable that only 7% of European companies in our research have comprehensive cover for terrorism and political violence risk.

“A further one in five believes that these risks are covered under another policy, but our experience shows that this is often not the case. Insurers and brokers must work together to help European businesses understand the potential gaps that exist in their insurance cover and take informed decisions on insurance purchasing.”