No Rush to Buy Terrorism Insurance
March 11, 2003
Most of corporate America still has no insurance against terrorist attacks. Even after Congress offered federal support for insurance companies last fall and the companies began offering coverage in late November, few corporations in New York, Washington and Chicago -- which authorities say are most vulnerable to attacks -- have bought the coverage.
- Many corporate executives say the premiums are too expensive, especially since the federal government has agreed to pay 90 percent of all losses above $10 billion in the event of an attack.
- They also say that while the insurance provides economic protection against bombs and many other kinds of violence, it does not cover attacks by American extremists or attacks by anyone with nuclear, chemical or biological weapons.
- The only exception is the owners of skyscrapers in Midtown and Lower Manhattan -- and they are buying because their lenders are insisting on it, according to reports.
- Otherwise, most property owners simply don't envision their buildings being the object of an attack, insurers say.
Source: Joseph B. Treaster, "Insurance for Terrorism Still a Rarity," New York Times, March 8, 2003.
Browse more articles on Tax and Spending Issues