How Safe Are You? Terrorism Insurance and TRIA

Since they were first built, apartment buildings have been insured for disasters and unforeseen circumstances—the things nobody ever wants to happen, but has to admit are possible. Things like fires, floods, earthquakes and so on. In the past, terrorism was thought of as being something that happened in other countries, but since 9/11, the fear of terrorism—and the desire to make sure one’s home is safe from it as much as possible—have taken center stage in the minds of many New Yorkers.

Ironically, when nobody was concerned about it, insurance against acts of terrorism for an apartment building—or any other type of building—was readily available for a reasonable fee. But after the World Trade Center disaster, when everybody was concerned, it suddenly became either unavailable or very costly, and the federal government had to step in.

A Problem in Itself

By its very nature, terrorism insurance is more problematic than, say, flood insurance. By studying the weather, scientists have been able to predict, more or less, which regions are most vulnerable to storms and hurricanes, and thus people living in those areas can purchase the proper amount of coverage for their homes and property. However, acts of terrorism in the U.S. have been few and far between, so there is little data to analyze.

Obviously, large urban areas with important corporate headquarters or government-agency headquarters are possible targets for violent extremists—and nearby residential buildings could get caught in the fallout—but predicting if and when and where a terrorist strike may occur is hardly an exact science.

Even as the beginnings of terrorism within the U.S. began to surface in the 1990s with the first attack on the World Trade Center, the Oklahoma City bombing, the Atlanta Olympics bombing, the subject seemed blissfully remote for the majority of Americans. Insurers provided terrorism coverage as part of their commercial insurance with little or no additional charge because the possibility of a terrorist bombing or incident was considered almost nil.


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