You probably have not given it much thought but does your business insurance or motor insurance plan come with political violence and terrorism coverage? Unknown to most people, standard insurance plans in Kenya don’t cover losses arising out of:
- Political violence, such as:
- Civil unrest.
- Insurrection which includes revolutions, rebellion, revolt, insurgency and general public disorder.
- Political risks such as:
- Government expropriation or asset confiscation.
- Government frustration or contract repudiation.
- Calling of letters of credit and similar guarantees without just cause.
- Business Interruption.
- Inability to convert foreign currency.
- Inability to repatriate funds.
But, as with any insurance plan, the actual scope of coverage is determined by the terms of your policy.
The Political Violence and Terrorism Risk in Kenya
Kenya is right in the thick of things as far as terrorism goes. Over the last two decades there have been a number of deadly terrorist attacks, namely; The US Embassy Bombing, Kikambala Hotel bombing, The Westgate Mall shooting, Garissa University attack, and the Nairobi DusitD2 Complex attack. All these have led to loss of life on a massive scale, life long injuries and wanton destruction of property.
As for the political climate, while calm, for the most part, often erupts into violence and public disorder that leads to bodily injury and damage to property. Every so often there will a news report about how a political rally descended into violence with vehicles being burned.
Deaths from Terrorism Map
It is unfortunate that most people find out after the fact that their insurance policy doesn’t come with standard coverage for political risks and terrorism.
How to Get Coverage for Political Violence and Terrorism
For motor insurance, you will usually pay a small extra premium based on the value of your car to get the political violence and terrorism extension. The same applies to your business and home insurance.
You just need to ask your insurance agent to provide a quote for the increased coverage.
With regard to terrorism insurance cover, we have two classical points, which is first-party terrorism insurance, the building, the property, or something that’s damaged either through a blast or an attack. And then we have the third party, that is, the liability of the insured against people claiming damages. For example, if there is an attack at an office block, some of the questions that would be asked are whether the security was good enough. An aggrieved person could use that as justification for a civil suit for damages.
But, terrorism has adapted which has also forced insurance to adapt and expand into different endorsements and coverages. So, for example, we now have coverage for denial of access and business interruption. Let’s imagine an office block is a target. If anything happens, the tenants would be denied access. Today, we could have active assailant, which used to be known as an active shooter. Thus, the Westgate and DustiD2 attackers are active assailants because, in addition to using guns, they also used vehicles packed with improvised explosive devices (IED). During both attacks, there was a lot of business interruption because the premises had to be closed down and tenants denied access for a long period of time. So, a lot of businesses lost money through business interruption.
There are also new types of terrorism coverage such as event cancellation where you are forced to cancel and event because of a recent terrorist attack nearby. We also have cyber terrorism which covers losses as a result of the Internet being used to cause financial losses.
Don’t be a victim today, secure your business and assets with political violence and terrorism insurance. Contact us today for a no-obligation quote. One of our Insurance Gurus is waiting to serve you.