Vehicles Weaponised By Terrorists - Are You Covered?

Following a vote by Motor Insurance Bureau (MIB) members, UK motor insurers have agreed to pool terrorism claims from the beginning of 2019 to cover third-party claims where terrorists use vehicles and cause property damage, death or bodily injury. 

Under the agreement, insurers will pay a levy to the MIB so that costs are shared across all insurers should an insured vehicle be used in a terrorist attack. This is an extension of the Bureau’s existing agreement to handle claims from victims of uninsured drivers and untraced motorists. 

The move follows two extremist attacks in the UK in 2017, and similar attacks in Europe, where terrorists used vehicles to cause death and bodily injury. Both incidents on Westminster Bridge and London Bridge exposed complications when compensating victims under current third-party insurance arrangements. 

Although the agreement by Insurers is welcome, cover from the Pool is limited to £1.2m in respect of Third Party Property Damage.  Losses arising from Third Party Personal Injuries are currently unlimited. 

Third Party Property Damage resulting from an act of Terrorism above that limit of £1.2m would need to be covered by your own fleet Insurers, and it’s important to ensure that you have cover here, as a HGV carrying Hazardous Goods could cause a significant amount of damage.      

Businesses that carry dangerous loads represent a significant risk and drivers should be: 

• Instructed to avoid talking about loads or routes with other drivers or customers including over radios, phones or via social media.

• Cautious if they are forced to stop, for example, at the scene of an accident or an emergency, or at police stops.

• Avoiding regular routes or stops for newspapers, cigarettes or meals – a recognisable pattern makes you an easier target. 

If your drivers are stopped by the Police or any other competent authority whilst carrying a dangerous load, and are suspicious about the validity of the officer, then they should follow the instructions on the reverse of the dangerous load card. 

You should also consider how your business would respond in the event of a Terrorist attack using your vehicles.  Ill-informed media interest can damage reputations very quickly, and having access to crisis consultants and post-event trauma counselling should form part of a robust Crisis Management Plan. 

In addition, your business can be directly or indirectly prevented from operating due to a police cordon or damage, and business interruption cover can be extended to help prevent loss of earnings from a terrorist act even where no damage occurs. 

Given the scale of potential damage or injury that can result, and the variety of cover available, prudent businesses really should review their current levels of Terrorism cover and establish the costs of buying top-up cover before making an informed decision.  Premiums are typically a fraction of the overall fleet costs, and as with so many other decisions facing company directors, the consequences of getting it wrong can follow them personally, so it’s important on a number of levels to get it right.