Terrorism insurance pool set to expand

Following the recent terror attacks, the Insurance Regulatory and Development Authority IRDA expects new and innovative policies to provide cover against such terrorist activities. 8220;Terror insurance products are bound to be upgraded and the rate of premium might change depending upon the evolution of new products that the industry may come up with,8221; IRDA chairman J Hari Narayan said.

All claims arising from any terrorist activity are furnished through the terror insurance pool formed by general insurance companies in 2001. The pool, which has a corpus of over Rs 1,000 crore, allows an insurer to withdraw to the extent of Rs 750 crore per location. However, this pool will grow as insurance companies are bound to be buffeted by growing insurance claims, said Hari Narayan.

Speaking about the insurance claims, IRDA chief said so far hardly any claims have come. 8220;It is too early to say how much claim would come.8221;

According to industry sources, terror premium is expected to go up as the projected liability due to terror attack may be substantial.