Search results
1 – 10 of over 1000Stephen Mixter and Michael Owendoff
The intent of this paper is to provide an overview of the principal provisions of the Terrorism Risk Insurance Act of 2002 (the ‘Act’),1 which became law in the USA on 26th…
Abstract
The intent of this paper is to provide an overview of the principal provisions of the Terrorism Risk Insurance Act of 2002 (the ‘Act’),1 which became law in the USA on 26th November, 2002, and the practical effects which the Act has had on the state of terrorism insurance coverage as it had evolved between 11th September, 2001 and the passage of the Act. The Act voids some of the exclusions which had made their way into insurance policies (particularly post‐9/11) relating to losses from certain ‘acts of terrorism’ (as defined by the Act) and requires insurers meeting certain criteria to ‘make available’ terrorism insurance coverage to their insureds. The Act also establishes a temporary federal reinsurance programme which provides a system of shared public and private compensation for insured losses resulting from certain certified acts of terrorism. From the standpoint of the average insured, however, the practical impact of the Act has been far less dramatic than may appear on the face of it. As The Department of the Treasury explained in its Final Rule,2 one of the main purposes of the Act was to address market disruptions that resulted in the aftermath of the September 11th terrorist attacks on the USA and to ensure the availability and affordability of property and casualty insurance for certain risks associated with acts of terrorism. In addition, the Act was designed to provide a transitional period for the private insurance markets to stabilise, thereby allowing insurance companies to resume pricing terrorism insurance coverage. The Act also sought to build capacity in the insurance industry to absorb any future losses, while preserving insurance regulation and consumer protections in the individual states.
Details
Keywords
Md Badrul Alam, Muhammad Tahir, Norulazidah Omar Ali, Muhammad Naveed Jan and Aziz Ullah Sayal
This paper empirically examines the impact of terrorism on the insurance–growth relationship in the context of Middle East and North Africa (MENA) region, thereby attempting to…
Abstract
Purpose
This paper empirically examines the impact of terrorism on the insurance–growth relationship in the context of Middle East and North Africa (MENA) region, thereby attempting to address the unexplored area in the relevant literature.
Design/methodology/approach
The study considered MENA as it has been one of the terribly affected zones in the world during the study period. Panel data for the period (2002–2017) are sourced from reliable sources for 14 member economies of the MENA region.
Findings
After employing the suitable econometric procedures on the panel data, the results indicate that terrorism appears to have detrimental impact on the observed positive relationship between insurance and economic growth. In addition, trade openness seems to be the main driving force behind economic growth of the selected MENA countries. Surprisingly, the study suggests a negative association between the growth of physical capital and economic growth. Human capital has played a positive but insignificant role in improving economic growth as it is insignificant in majority of the specifications. The growth of labor force has although positively but insignificantly influenced economic growth. Finally, the results demonstrate that government expenditures and high inflation are harmful for growth.
Originality/value
The study investigated the impact of terrorism on the insurance–growth relationship for the first time, and hence policymakers of the MENA region are expected to be benefited enormously from the findings of the study.
Details
Keywords
Stephen Mixter and Michael Owendoff
The 11th September terrorist attacks on America continue to affect the corporate real estate industry, and this paper is intended to address a number of those ongoing effects. It…
Abstract
The 11th September terrorist attacks on America continue to affect the corporate real estate industry, and this paper is intended to address a number of those ongoing effects. It first discusses property insurance coverage in general and then proceeds to analyse whether damage from acts of terrorism is covered under pre‐11th September and post‐11th September property insurance polices. It also addresses the current status of proposed US Government intervention as a terrorism insurance backstop. It then describes the strategies which certain clients located within the areas directly affected by the terrorist attacks implemented in order to be able to gain immediate access to alternative space. Finally it examines selected lease clauses to which landlords and tenants should pay closer attention in light of the terrorist attacks, including operating expense provisions, force majeure provisions, waiver of subrogation provisions, use prohibitions and alteration provisions.
Details
Keywords
Traditionally, terrorism risk has been priced based exclusively on the relationship between supply and demand in the insurance market, with no basis in actuarial principles. This…
Abstract
Traditionally, terrorism risk has been priced based exclusively on the relationship between supply and demand in the insurance market, with no basis in actuarial principles. This article discusses how the tragic events of September 11, 2001, have irrevocably changed the market for terrorism insurance, since terrorism has become a U.S. catastrophe risk. The author states that since insurers seek to quantify risk distributed over several months (versus a period of only a few days), quantitative assessment of terrorism risk may be achievable. The article proceeds to address the challenge of quantifying terrorism risk, and ultimately suggests that developing quantitative terrorism risk models may provide a foundation for securitizing and trading terrorism risk. The author introduces three examples of potential alternative risk transfer instruments for terrorism risk: 1) a catastrophe bond triggered by workers' compensation claims from extreme terrorism‐related events; 2) a catastrophe bond to cover life insurers from losses related to an attack employing a weapon of mass destruction; and 3) a contingent financing instrument triggered by a terrorism event whose natural buyers are financial short‐sellers.
Reviews the history of insurance against acts of terrorism. Losses by reinsurers resulting from major bombing incidents in the early 1990s precipitated changes to insurance cover…
Abstract
Reviews the history of insurance against acts of terrorism. Losses by reinsurers resulting from major bombing incidents in the early 1990s precipitated changes to insurance cover and the introduction of exclusions. Explains these changes and their implications for property owners.
Details
Keywords
The purpose of this paper is to explain why, as a matter of law and policy, loss suffered as a consequence of terrorism, insurrection and/or civil uprising is not generally…
Abstract
Purpose
The purpose of this paper is to explain why, as a matter of law and policy, loss suffered as a consequence of terrorism, insurrection and/or civil uprising is not generally compensable in insurance law. The paper postulates that it is the duty of the state, particularly in small states, to compensate loss of this type.
Design/methodology/approach
The paper achieves this objective by studying the attempted coup d'état by Muslim fundamentalists in Trinidad and Tobago in 1990 and the devastating property losses suffered during the attempted coup as a consequence of looting and arson. The standard terms of two main policies then in use are meticulously set out and examined in the context of the relevant case law and textbook learning on the subject of losses of this type.
Findings
The paper demonstrates that losses occasioned as a consequence of activity of the type under reference – that is terrorist activity, insurrection and civil uprising – cannot be dealt with by insurance companies and that it falls to the state as the guardian of national security and as an honest broker in the development of the economy to ensure even development by compensating losses occasioned as a consequence of terrorist activity, insurrection and/or civil uprising.
Originality/value
The paper for the first time puts in context losses of the type now being experienced in many parts of the world and explains the limitations of the traditional insurance law principles to treat with these losses. The solution of state compensation as a last resort to compensate innocent victims in these circumstances is advanced as a possible solution.
Details
Keywords
Index by subjects, compiled by K.G.B. Bakewell covering the following journals: Facilities Volumes 8‐17; Journal of Property Investment & Finance Volumes 8‐17; Property Management…
Abstract
Index by subjects, compiled by K.G.B. Bakewell covering the following journals: Facilities Volumes 8‐17; Journal of Property Investment & Finance Volumes 8‐17; Property Management Volumes 8‐17; Structural Survey Volumes 8‐17.
Compiled by K.G.B. Bakewell covering the following journals published by MCB University Press: Facilities Volumes 8‐17; Journal of Property Investment & Finance Volumes 8‐17;…
Abstract
Compiled by K.G.B. Bakewell covering the following journals published by MCB University Press: Facilities Volumes 8‐17; Journal of Property Investment & Finance Volumes 8‐17; Property Management Volumes 8‐17; Structural Survey Volumes 8‐17.
Compiled by K.G.B. Bakewell covering the following journals published by MCB University Press: Facilities Volumes 8‐17; Journal of Property Investment & Finance Volumes 8‐17;…
Abstract
Compiled by K.G.B. Bakewell covering the following journals published by MCB University Press: Facilities Volumes 8‐17; Journal of Property Investment & Finance Volumes 8‐17; Property Management Volumes 8‐17; Structural Survey Volumes 8‐17.
Compiled by K.G.B. Bakewell covering the following journals published by MCB University Press: Facilities Volumes 8‐17; Journal of Property Investment & Finance Volumes 8‐17;…
Abstract
Compiled by K.G.B. Bakewell covering the following journals published by MCB University Press: Facilities Volumes 8‐17; Journal of Property Investment & Finance Volumes 8‐17; Property Management Volumes 8‐17; Structural Survey Volumes 8‐17.