Incidents of terrorism and sabotage, fuelled by ongoing issues such as geopolitical tensions, are a constant societal threat with significant potential to impact businesses. Despite this, there is often an “out of sight, out of mind” attitude.

This is understandable given the perceived rarity of incidents. However, it could lead to an assumed absence of risk.

Terrorism and sabotage is a tangible threat, especially as 2025 started with headlines around incidents in New Orleans and Las Vegas.

The latest Home Office data showed at the year-end June 30, arrests for terrorism related offences were up 50 per cent year-on-year and 20 per cent over the five-year median.

There is also a growing issue around single actor incidents where perpetrators are not part of terrorist organisations. Data from the Global Terrorism Index shows a rise in unaffiliated individual terrorist attackers in the West.

This highlights the real threat of terrorism and underpins why attention on business insurance policies is essential.

There’s an opportunity to critique policy coverage to ensure it aligns with potential business losses following incidents.

At Fiducia MGA, this is a core priority behind our standalone Terrorism and Sabotage policy and ensures appropriate cover is provided in a flexible, competitive way.

Underwriter David Heeney explains how.

A wider definition of Terrorism

In the UK, the most often cited name associated with terrorism insurance is Pool Re – a government company set up in 1993 to provide cover in response to the threat posed by the IRA.

Pool Re, however, follows the UK government’s definition of Terrorism, which does not include persons acting alone.

Yet, given the risk of single actor attacks, this presents a potential cover gap.

This is why at Fiducia our policy uses a definition of Terrorism which includes single actor or “lone wolf” incidents.

More agile coverage

To ensure our broking partners can support their clients with their Terrorism cover, we prioritise a flexible, agile mindset.

Where this stands out is amongst business clients who operate across multiple premises. They would normally insure all these properties for the traditional perils with a general commercial insurer and if they opt for Terrorism cover with Pool Re, they must effect Terrorism cover on all these eligible properties, otherwise, they are in breach of Pool Re’s adverse selection / “All or Nothing” rule.

However, this might not accurately reflect their Terrorism risk profile. For example, the threat to a business premises in a busy metropolitan area often targeted by terrorists is different to one more remote.

To address this, our Terrorism policy does not apply adverse risk selection. This means that the insured can pick and choose which locations they want to cover.

It also allows cover on a First Loss basis where the insured can float the sum insured across their portfolio.

Compared to the “All or Nothing” approach, this benefits clients with more bespoke cover by focusing in on perceived location risk exposures.

Accessing bespoke cover this way also benefits clients by potentially opening up substantive premium savings.

Embedded business interruption coverage

Some of the misconceptions around Terrorism insurance is that businesses have to be targeted directly, or that their buildings have to suffer physical damage to experience losses.

However, Denial of Access and Loss of Attraction can result in lost revenue in the wake of an incident. This is why our policy comes with cover against this as standard, supported by market-leading wording around Business Interruption.

For example, non-damage Denial of Access provides cover for any business located within one mile of a Terrorism incident, shielding against losses even though they have not been directly targeted.

Cover also extends for financial loss resulting from interruption to the business if the utility supplies are damaged by an Act of Terrorism.

Businesses are also covered if there have been responses to the threat of an incident, without one having taken place. For example, losses incurred from evacuation, street closures or street cordons.

This all sits alongside cover as standard against physical damage as well as clean-up and emergency service costs.

Catering for many sectors

Our Terrorism & Sabotage policy provides up to £250m of cover on any one occurrence.

Alongside its far reaching benefits and market-leading wording, this makes it ideally suited to any client who has a Business Interruption risk exposure where property access is essential to revenue.

Examples include retail, leisure, health and social care, tourism, manufacturing and hotels.

It is also suitable for property owners, both commercial and domestic including student sites or any investment property.

Putting clients first

Complementing the extensive cover, flexibility and broad range of sectors our policy supports, maximising Terrorism cover also means working with partners who prioritise service levels.

Often there is a “click-to-buy” approach in the wider marketplace which does not ensure brokers and clients have access to the right service levels or expertise amongst Underwriters.

This is not the case at Fiducia MGA, and a core mission with our Underwriting team, is to ensure they work in clients’ best interests. On top of this is their expert knowledge on Terrorism risk.

For example, our Underwriters are accessible when needed, respond in a timely way, provide expert advice and offer facilities with A-rated UK capacity.

Combined, these are valuable assets when it comes to protecting businesses against Terrorism losses in a world of constant risk.

Want to know more?

Learn more about our standalone Terrorism & Sabotage policy on our website and in our product summary.

To discuss your specialised cover requirements, risk management needs or partnering with Fiducia, contact David Heeney on M: +44 759 084 0416 or E: david@fiduciamga.co.uk. To learn more about our expert Underwriters, click here.