In the 4th session this autumn of AIG Academy Connected, Terrorism and Political Violence was discussed, presenting an overview of the subject and its impact in the world today and what protection AIG offers from its products related to this field. The webinar was hosted by Elisabeth Hellemose, Branch Manager Norway at AIG, while Edward Atkin and Georgina Rennie from Talbot Underwriting and James Spencer, Global Terrorism Risk Consultant at AIG, presented the topic and insights from their points of expertise.
James Spencer begins his presentation by giving a short brief of the basic principles and definition of political violence, involving both history and new elements. He explains how regions that are considered low risk are becoming unstable through increasing political polarization; and that climate change and the technological acceleration are other factors that affect political stability (e.g. an evolved communication landscape through smart phones and similar tools). Spencer highlights that political violence has changed when speaking of terrorism that earlier could be traced to cells in terrorist groups with specific skills, to now having developed into more complex attacks, often on an international level where maximum casualties is the target. He also points put that attacks are often carried out on an individual level, meaning attacks with short-leadtime linked to self-radicalisation.
Edward Atkin digs deeper into the underwriting aspect of political violence, highlighting that exposure needs to be individually priced and aggregated due to high risk nature. The aggregation characteristics in political violence can be divided into three main perils: Terrorism, Strikes, Riots and Civil Commotion Clause (SRCC) and war on land with different geographic footprints that are closer explained in the presentation. Tailored coverage is important depending upon the client’s occupancy and geographic interests.
From a product perspective, Georgina Rennie states that since political violence is constantly evolving, insurers needs to be dynamic in terms of product offering. She especially points on three different products of relevance: Active shooter/Malicious attacks, involving coverage responding to attacks that cause bodily injury and invole deadly weapons. Loss of Attraction, covering loss of profit to the assured at a named location (e.g. an attack at an airport which causes major consequences for actors on the ground) and CBRN, meaning the coverage related to chemical, biological, radiological and nuclear attacks. Georgina in more detail explains the purpose and content of each of these products in her presentation.
Learn more about understanding Terrorism and the changing political Violence Landscape by watching the full webcast through the link below.