Jonathan Kwok – Straits Times Indonesia
Singapore. A new consortium has been set up here to insure Asia-Pacific companies against terror attacks.
The Xin Consortium believes it could be the first gathering of underwriters in Singapore whose sole purpose is providing cover against terrorism.
Many other firms or insurance consortia provide such coverage but it is usually part of a larger suite of services.
Only 5 percent to 10 percent of businesses with commercial insurance consider buying terrorism coverage in Singapore while the percentage is even lower elsewhere in the region, said Simon Clarke, managing director of Amlin Singapore, one of the four firms in the consortium.
A company does not need to be the direct target of an attack to be severely affected. “You can be close to the target and suffer the collateral damage, which can disrupt businesses and put them out of action,” he said.
He cited a Straits Times report late last month about the possibility of an offshoot of hardline group Jemaah Islamiah being the latest regional threat.
Clarke also cited 2009’s bomb blasts at Jakarta hotels, and 2010’s Bangkok riots as examples of developments that could impact a company’s operations.
Amlin, Markel, Canopius and Argenta are the four insurance syndicates forming Xin Consortium, which also insures against other risk events like strikes, riots and civil commotion, for up to $110 million for a single risk.
The syndicates are all part of Lloyd’s of London, a British insurance and reinsurance market, where underwriters and firms pool and spread risk. As such, Xin Consortium is backed completely by Lloyd’s.
The group received authorisation from the Monetary Authority of Singapore last year and has already attracted clients.
It said hotels, government buildings and foreign companies are among possible terrorist targets that could consider buying such insurance.
The consortium has a dedicated team based at Lloyd’s Asia’s premises at Asia Square in Marina View.
The Sept 11., 2001, attacks in the United States raised awareness among firms, especially in the West, of the need to buy terrorism insurance. In Asia, many major insurers provide such coverage as part of their suite of services.
Consortia to provide coverage against terrorism have also developed in neighboring countries hit by such attacks, such as Indonesia.
Reprinted courtesy of Straits Times Indonesia. To subscribe to Straits Times Indonesia and/or the Jakarta Globe call 021 2553 5055.