Although most commercial policyholders can readily find terrorism insurance, owners of  large, high-value properties in areas viewed as “high risk” of a terrorist attack still experienced trouble finding “reasonably-priced” premiums in the past few years, according to a study recently released by the United States Government Accountability Office (GAO).

The six-month long study investigated whether or not the availability of commercial terrorism insurance was constrained in any particular places and what impact those constraints had on premiums.  The study found that prices for terrorism insurance have been stable since 2003, and the percentage of companies who purchase it has also remained stable at 60%. The northeast region was cited as having the largest percentage of companies – 70% – that buy property terrorism insurance.

However, in order to find full coverage in high-risk areas, some policyholders bought layers of terrorism coverage from several insurers, which can be “complex and time-consuming” and some bought coverage through a policy separate from their regular commercial insurance, which can be more expensive, the report said.

Initial Results on Availability of Terrorism Insurance in Specific Geographic Markets (GAO)

August 12, 2008