Terrorism Insurance Sales Lag Sticker shock anda perceived lack of exposure to terrorist events in non-urban areasare dissuading many organizations from purchasing terrorisminsurance, according to those involved in selling or buying thiscontroversial coverage.

There are those, however, who did buy, often after spiritednegotiations over premiums and terms with insurers uncertain onexactly how to price and underwrite this new product. The TerrorismRisk Insurance Act of 2002 requires insurers to offer terrorismcoverage, but does not mandate its purchase and does not specifywhat insurers can charge.

“Only about 15 percent of clients with property values over $100million have purchased the terrorism coverage,” said CynthiaMichener, a spokesperson for The Hartford Financial Services Group,based in Hartford, Conn. The 85 percent that turned it down “didn'tconsider themselves in hazardous locations for terrorism,” Ms.Michener added. “These are large clients with risk managers andthey decided to assume the risk themselves.”