Terrorism & Political Violence Insurance
Political instability can erupt with little warning, threatening personnel, assets and operations. Terrorism insurance covers physical damage and business interruption caused by a certified act of terrorism, an exposure that standard commercial property policies exclude. Broader political violence insurance covers the same terrorism perils and extends to war, civil unrest and related risks. Blackthorn places both as bespoke cover through the Lloyd’s market.
Differentiating Terrorism and Political Violence
Understanding which policy type you need requires clarity on how the terms are defined and where one ends and the other begins.
Terrorism Coverage:
Covers acts of violence committed for political, religious, or ideological purposes. The Terrorism Act 2000 provides the most widely referenced legal definition, though insurers and reinsurers may apply their own policy-specific definitions, and Pool Re operates under the definition established in the Reinsurance (Acts of Terrorism) Act 1993. A standalone terrorism policy covers physical damage to property and business interruption caused directly by a certified terrorist act.
Political Violence Coverage:
A significantly broader form of protection. It encompasses terrorism but extends to include war, civil war, rebellion, insurrection, strikes, riots, and civil commotion. For organisations operating in volatile regions, this wider scope is essential. A terrorist act may trigger a standalone terrorism policy; the broader unrest that surrounds it often will not.
Political Risk Insurance: Goes further still, covering non-physical risks such as government expropriation, currency inconvertibility, and contract frustration. Where Political Violence Insurance responds to physical loss and damage, Political Risk Insurance responds to economic and political interference.
For most organisations with overseas operations or assets in high-risk environments, a standalone terrorism policy is a minimum baseline. Political Violence coverage is the appropriate solution for those whose exposure extends to civil conflict, regime instability, or widespread unrest.
What Does Terrorism and Political Violence Insurance Cover?
Standard covers include physical damage to buildings, vehicles, plant and machinery, business interruption, denial of access, and loss of attraction. Policies can be extended to include:
- Non-damage business interruption, where a terrorist incident disrupts operations without causing physical damage to your property
- Looting and theft of stock during civil unrest
- Transit cover for goods lost or damaged during a political violence event
- Construction projects, for the full build period
- Third-party terrorism liability
- Active Assailant cover
- Threat cover
- Event Cancellation cover
- Nuclear, Chemical, Biological, and Radiological (CBRN) terrorism coverage
- Cyber extension covering property damage arising from a cyber-triggered terrorist act
- Energy-specific liability and control of well extra expenses
Policies are placed through Lloyd’s of London and structured around your specific risk. We cover a wide range of sectors and asset types, from commercial real estate and hospitality to energy, infrastructure, NGOs, and construction projects in high-risk jurisdictions.
The UK Regulatory Context: Pool Re and Martyn's LaW
Two developments are directly relevant to any UK business reviewing its terrorism exposure.
Pool Re
Pool Re is a mutual reinsurance scheme established in 1993 following IRA attacks on the City of London, most notably the Baltic Exchange bombing in 1992, which caused reinsurers to withdraw terrorism cover from the commercial property market entirely. It acts as a government-backed reinsurer of last resort behind terrorism policies written by member insurers. Pool Re’s own research indicates that only around 5% of UK SMEs currently carry terrorism insurance cover.
Pool Re focuses on property damage and direct business interruption. It does not automatically extend to political violence in the broader sense, non-damage business interruption, or international exposures. Businesses assuming Pool Re provides comprehensive protection should review the scope of their cover carefully.
Martyn’s Law
Martyn’s Law, formally the Terrorism (Protection of Premises) Act 2025, received Royal Assent on 3 April 2025. A minimum 24-month implementation period applies before the Act’s requirements come into force, but businesses in scope should be preparing now. When in force, it will place obligations on venues and events with a capacity of 200 or more, with enhanced requirements for those expecting 800 or more.
Martyn’s Law is a preparedness obligation, not an insurance mandate. A terrorism policy with liability and non-damage business interruption extensions sits alongside compliance rather than replacing it. We work directly with Lloyd’s market underwriters who have detailed knowledge of both Pool Re’s scope and the implications of Martyn’s Law for commercial policyholders.
Who Needs This Cover?
Standard commercial property policies exclude terrorism as a matter of course. Without a standalone policy, businesses in any sector carry an uninsured exposure.
This cover is particularly relevant for:
Commercial property owners and developers in major cities or high-footfall locations, where denial of access and non-damage business interruption are the most likely loss triggers.
Multinationals and corporations with operations or supply chains in politically unstable regions, where civil conflict or insurrection is a realistic risk.
Energy, extractive, and infrastructure businesses in high-risk jurisdictions across the Middle East, Africa, and South and Central Asia.
NGOs, charities, and humanitarian organisations deployed in active conflict zones.
Event operators, hospitality businesses, and venue managers, for whom Martyn’s Law has made terrorism risk a board-level concern.
Property investors with international portfolios, where individual assets may carry political violence exposure regardless of overall portfolio risk.
Why Place With Blackthorn Risk?
Terrorism and political violence is not a standard commercial line purchase. Policy wordings vary considerably between insurers, and the difference between a certified terrorism trigger and a political violence trigger can determine whether a claim is paid in full, partially, or not at all.
As a specialist Lloyd’s broker, we have direct access to the underwriters who lead this market. We work with specialists in malicious risk who understand complex definitions and can structure bespoke coverage around your operational footprint. We provide a full exposure review before any placement, identifying gaps between your existing programme and the risks your business actually carries.
Where combined coverage across terrorism, political violence, and related perils such as kidnap and ransom or security evacuation is appropriate, we can structure an integrated solution.
To discuss your exposure, contact our team directly.
FAQS
What is the difference between Terrorism and Political Violence insurance?
Terrorism insurance covers acts driven by political, religious, or ideological motives. Political Violence is broader, extending to war, civil war, rebellion, insurrection, strikes, riots, and civil commotion.
What is 'Denial of Access' coverage?
It compensates you for lost income if you cannot access your premises due to a security threat, such as a police cordon following a nearby incident, even if your own property was undamaged.
Is terrorism insurance included in my standard commercial property policy?
No. Standard commercial property policies exclude terrorism as a matter of course. Pool Re-backed cover may be available as an extension through your property insurer, but this is limited to property damage and does not cover non-damage losses, denial of access, or political violence in the broader sense.
What is the difference between Pool Re and a standalone terrorism policy?
Pool Re sits behind terrorism extensions on standard property policies and covers property damage in the UK. A standalone Lloyd’s market policy can cover international exposures, non-damage business interruption, denial of access, loss of attraction, and political violence beyond the certified terrorism trigger.
Does Martyn's Law require businesses to take out terrorism insurance?
No. It is a security preparedness obligation. A terrorism policy with liability and non-damage business interruption extensions complements Martyn’s Law obligations rather than substituting for them.
Can a policy cover international operations?
Yes. A Lloyd’s market policy can cover international assets, overseas operations, and employees in high-risk regions, including war, civil conflict, insurrection, and government-directed violence.
What is the difference between Political Violence Insurance and Political Risk Insurance?
Political Violence Insurance responds to physical loss from violent events. Political Risk Insurance covers non-physical risks such as government expropriation, currency inconvertibility, and contract frustration. Some organisations with significant international operations require both.
How much does terrorism and political violence insurance cost?
There is no fixed price. Premiums are set per risk, based on factors including location, sector, the value and type of assets insured, the claims and threat environment, and whether cover is placed as a backed extension or a standalone Lloyd’s market policy. A specialist broker can structure cover around your actual exposure rather than a generic rating, which matters where the difference between a certified terrorism trigger and a political violence trigger affects how a claim responds. Contact our team for a placement priced to your risk.
Does travel insurance cover terrorism?
Personal travel insurance and commercial terrorism insurance are different products. Some travel policies include limited terrorism-related cover for individuals, such as medical costs or trip disruption, but they do not cover an organisation’s property damage, business interruption or liability. If your concern is protecting business premises, operations or people in high-risk regions, commercial terrorism and political violence cover is the relevant product, and cover for personnel in hostile environments sits under high-risk travel and personal accident or medical evacuation.
What does political violence insurance cover?
Political violence insurance covers physical damage and business interruption caused by a broad range of violent political events. It includes the terrorism perils and extends to war, civil war, rebellion, insurrection, strikes, riots and civil commotion. For organisations with assets or operations in volatile regions, this wider scope covers unrest that a standalone terrorism policy alone would not.
