Boston Bombings

[FEX Quotes]

I wonder how many insurance companies involved in claims regarding the Boston bombings this past week are going to deny coverage if a TRIA exclusion is in place in light of the Fed officially labeling this an act of terror?

http://www.naic.org/cipr_topics/topic_tria.htm

 

[Accelerated]

Well, it was an act of terror. Terrorism is generally excluded unless you pay extra.

Having a home or business in a major downtown metropolitan area and not having a terrorism endorsement is like building a home on a mountainside and not purchasing landslide endorsements. It is probably not going to happen, but if you want it covered if it does, pay the money.

I wonder how many people will file BI claims though, since they shut down the city.

 

[FEX Quotes]

Well, it was an act of terror. Terrorism is generally excluded unless you pay extra.

Having a home or business in a major downtown metropolitan area and not having a terrorism endorsement is like building a home on a mountainside and not purchasing landslide endorsements. It is probably not going to happen, but if you want it covered if it does, pay the money.

I understand all of this, but it got me wondering since the current administration was in a rush to officially call this a terroristic act.

Don't get me wrong. I am in no way down playing what happened, but it just got me thinking of the unintended consequences of such an action (terrorism label). I am sure the Fed wasn't even thinking about insurance as this was unfolding.
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I wonder how many people will file BI claims though, since they shut down the city.

These would not be BI claims. Who would they file a claim against? The "terrorist"? The city?

 

[BigIVU]

Calling an act terrorism is different from certifiying it as an act of terror. Under TRIA, the act must be certified as terrorism by the Attorney General, Secretary of State, and Treasury Secretary. Since that didn't happen, a certified terrorism exclusion wouldn't apply and you simply have property damage arising from an explosion.

 

[FEX Quotes]

Calling an act terrorism is different from certifiying it as an act of terror. Under TRIA, the act must be certified as terrorism by the Attorney General, Secretary of State, and Treasury Secretary. Since that didn't happen, a certified terrorism exclusion wouldn't apply and you simply have property damage arising from an explosion.

This is understood now but as events were unfolding, the administration was in fact labeling this terrorism. At this time it's academic, but a moderately different scenario of events could have easily earned this act the necessary certification.

What I find somewhat ironic here, and of course this is only speculation is that the insurance industry as a whole was and is not in favor of the PPACA, but should the administration had considered certifying this a terroristic act, they would have found a new best friend with the insurance industry..