What are the best insurance plans against terrorist attacks?

A detailed look at what type of insurance plans would or won't cover you sufficiently against terrorist attacks.

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Jay Vasa/
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May 5, 2023/
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5 mins 32 secs
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In light of recent violent events in different parts of the world, and especially Paris, Brussels, and Pathankot, demand for specialized insurance such as insurance against terrorist attacks is seen growing. 

The attacks, especially the ones in Paris, were reminiscent of the horrific events of 26th November 2013, when terror struck the heart of India’s financial capital.  The damage to life and property was immense and is well documented. It has well been established that terrorist attacks are here to stay and will continue to hit public places in the future too. 

Vary of the immense risk such attacks pose to their life and property there is an increased demand for specialized insurance products that cover the risk of damage to life and property, in such attacks. 

We have been increasingly getting queries on plans that cover such risks. To understand this, it is important to understand the nature of risk and to what extent should you be covered. 

Life Insurance

During a terror attack, the risk to life is most severe, and therefore as a responsible caregiver to your family, it is wise to have a term life insurance policy that covers risk to life from a terrorist attack either in-built into the base plan or as an add-on rider to the base plan.  A term insurance plan provides a huge sum assured to cover life risk in exchange for a relatively very small premium. The family or the beneficiary receives the full sum assured in case of death of the life insured. 

Should you get health Insurance or Personal Accident Cover? 

Another grave danger that wrecks the affected person financially and emotionally is a permanent disability or serious injury that requires complex medical procedures and prolonged hospitalization. In most cases, the number of injured in a terrorist attack is way more than the actual deaths. So from a statistical point of view getting injured in such an attack is more probable than death.  This is where health insurance policies come in. Since term-insurance policies only cover deaths, a health insurance or mediclaim policy is needed to bridge the gap.  Most health insurance plans do cover injuries arising out of terror attacks. Personal accident insurance plans provide cover for some major injuries caused due to an accident. Major injuries like loss of limbs, burns, etc are covered by this plan. Usually, this cover is available as an add-on rider along with the base plan. However, buying a standalone personal accident cover is often a good solution since the cover is comprehensive. While health insurance plans cover the cost of treatment, personal accident plans will provide lump-sum amounts in case of a major injury such as permanent disability. For temporary disability, a weekly compensation of 1 percent of the sum assured for up to 100 weeks is paid by the insurer.  The idea behind personal accident cover is to compensate the person insured for up to 100 times their monthly salary. However, it is important to check with the insurance company if the cover is available for injuries in terror attacks. 

Risk is more during Travel: Insurance can help

After 9/11, the aviation industry changed forever, and with it air travel. After recent attacks, destinations that were otherwise considered safe have become a tad bit risky. Traveling abroad is particularly risky as the traveler would be caught in a fix owing to the high cost of treatment if met with such an incident. Travel insurance, therefore, guarantees coverage against: 

  • Passport loss
  • Loss of baggage (delayed or checked-in)
  • Medical charges that involve hospitalization
  • Extended accommodation in case of terrorist attacks
  • Cancellation of trip
  • Interruption of trip
  • Medical expenses that might involve hospitalization
  • Repatriation of remains
  • Replacing important items
  • Emergency evacuation from the host country
  • Accidental injury

House & Property Insurance

House or commercial property is one of the biggest assets of an individual. These are susceptible to damage in a terror attack. Standard Fire & Allied Perils policy covers most of the mishaps that can occur to a property such as riots, fire, flood, and storm. Loss due to theft and burglary is covered under a burglary & house-breaking insurance policy. Valuables can be covered under all-risk policies and there are package policies for house owners and shopkeepers. However, a lot of insurers offer comprehensive policies which cover a lot of these aspects such as damage due to terrorist attacks. It is important to clarify whether there is a terrorism cover with your base plan or if is it available as an add-on rider by paying an additional premium. 

How is the sum assured estimated in home and property insurance? It is calculated either on the basis of Reinstatement Value (RIV) or Market Value (MV). In the case of M.V., depreciation is levied on the asset depending on its age when the loss occurs. The insured is not paid the amount sufficient to buy the replacement. 

In the RIV method, the owner of the insured property or house will get the full cost of replacement subject to a ceiling of the sum insured. No depreciation is taken into account under this method but the damaged asset should be repaired or replaced in order to get the claim. It may be noted that the RIV method is allowed only for fixed assets and not for other assets like stocks and stocks in the process.

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Jay Vasa is a content writer, who has got his core emphasis on insurance related information. The sole motive of writing articles is to spread appropriate information to the people regarding one of the important and discussed topic in today's time.