A London-based transport insurer announced it will be the first to provide its sector with coverage against "dirty bomb" damage.
TT Club said it will provide protection for nuclear and bio-chemical terrorism perils, starting Jan. 1, 2007. The company said that its "industry-leading initiative" is a recognition and response to demands from the industry that it insures.
Cover will be available for physical loss, business interruption and liabilities, and will be applicable in incidents involving both actual damage caused by an incident or device and when an incident occurs or a device is discovered causing significant trade disruption but no physical damage, the company said.
TT Club said it is offering cover for both direct and indirect business interruption, for example. The protection would cover members with goods delayed due to the closure of a third-party facility as a result of a nuclear or bio-chemical terrorism incident anywhere in the world.
The mutual insurer's membership includes ship operators, ports and terminals, road, rail and airfreight operators, logistics companies and container lessors.
Limit options will provide cover up to a maximum of $25million for any one incident per member while indirect business interruption losses will be available for limits up to a maximum of $5million, any one incident, per member. A pool aggregate limit for all claims in any one year of $100million is expected to be achieved, TT Club said.
Brian Wood, TT Club's underwriting director, commented: "Concerns have been expressed within the industry regarding the potential security threat presented by the risk of such attacks on the international transport infrastructure.
"The Club is always looking for options to improve the way in which its members' risk exposure can be managed and this pooling arrangement is a good example of finding a mutual solution to a common concern."
Mr Wood explained that premiums would be priced according to potential exposure and the size of limit chosen by the insured. In the event that there is no claim to the pool in any one year a 25 percent continuity credit will be offered to members who renew.
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