BQ Does UK’s rising terror risk require a new solution?

This month the UK government has raised the terror threat level for the country to Severe following a number of incidents which have thrust the issue of terrorism back into the spotlight. It comes as the Terrorism (Protection of Premises) Act, known as Martyn’s Law, will redefine the way in which premises in the UK will be required to protect customers and staff against the threat of violent and terrorist attacks.

The Act is expected to come into full force by early spring 2027 and has been described as ensuring  the public is better protected from terrorism by requiring certain public premises and events to be prepared and ready to keep people safe in the event of an attack.

The UK Government says under the Act certain larger premises will be required to consider and, where appropriate, take steps to reduce their vulnerability to acts of terrorism. A tiered approach is established under the new Act, with those responsible for premises and events in scope required to fulfil different requirements according to the number of individuals it is reasonable to expect may be present.

The law comes in response to the May 2017 bombing at the Manchester Arena in which a suicide bomber killed 22 people and injured 1017 others, all of whom were attending a concert at the venue.

As the risks rise, the London market has been asked to respond to what is a rapidly evolving issue and it provides another test of its flexibility and ability to innovate.

Lee Williams, Head of AdvantageGo, a Sapiens company

The response has begun with Beazley launching its new Deadly Weapons Protection (DWP)  Policy which is said to be the first in the United Kingdom in order to meet the changing risk threat.

Amy Batchelor, terrorism underwriter at Beazley says, “The UK has increased its terror alert status to Severe which signifies there is the likelihood of a terrorist attack in the next six months.

“We are also seeing an increase in knife crime which has risen by 153% in the past 10 years. Martyn’s Law is set to change the way businesses have to manage the risk of terrorism or deadly violence.”

She adds: “Deadly weapon protections policies will cover against a person or a group which attempts to kill or injure with a weapon. A weapon is defined as one which is handheld be it a gun, a knife, a syringe, or a motor vehicle.

“The policy goes further than terrorism and includes gang violence and domestic violence.”

However, it is Martyn’s Law which has created the need for an insurance industry response.

“The law has been designed to look to drive greater resilience and preparedness for terror-related violence in the United Kingdon Batchelor adds. “It has driven the need to identify and understand the threats and ensures that the necessary training and planning is in place.

“The risk requires a toolkit which goes beyond a simple insurance policy.”

While the act is set to come into force in spring next year there is still much that has yet to be defined by the Government.

“In terms of the law we have the what but not the how businesses will be required to meet the new regulations,” says Batchelor.

Beazley has a track record for such innovations having launched the first DWP coverage in the United States a decade ago.

“The policy was launched in the US due to the level of gun crime, education attacks and mass shootings,” she continues. “However late last year it became clear that with the arrival of Martyn’s Law and the rising threat level in the UK and in Europe that there needed to be a response from the market.

“Businesses have been asking brokers for support and advice on how Martyn’s law will impact their operations and for clarity in how they can comply in good time to the requirements.

“While the details have yet to be fully finalised there is a lot of support and advice that can be provided to begin the journey to greater resilience.

“What remains clear is that prevention is the primary aim of the work the industry needs to do with its clients. One terrorist event is too many.

“The cover provides support and crisis management capabilities post an event along with the more traditional coverage for property damage, business interruption and third-party liability.”

Batchelor added: “The UK market has a need for DWP policies given the risk levels that we currently face.”

Clients want to ensure they are meeting the regulations and new rules but primarily they want to ensure that their customers and staff are protected.

“Prevention is at the forefront of our work with brokers and clients. We need to ensure they are as prepared as they can be.”

Batchelor added there are currently a handful of markets that are offering the product globally, but that Beazley’s decision is a first for the UK and is likely to be followed by its peers.

When we launched in the USA it was a case that clients were concerned about the threats and were looking for solutions from the market.

London was once again able to prove its ability to innovate and create those solutions.

The UK has a heightened risk, and the industry needs to react and support its clients.