Rod Kitchen highlights some of the scenarios that could occur
The insurance industry's claims departments have a long experience in dealing with weather-related catastrophes. As soon as events such as storms or floods occur a well oiled machine springs into action to ensure call centres are manned, policy covers identified, loss-adjusters appointed and supply chains alerted.
The industry also has experience of terrorist attacks using conventional explosives, such as the Manchester bomb in 1996, but is it as prepared for the problems we could face from a terrorist attack using chemical, biological radiological or nuclear (CBRN) weapons?
A terror attack on London is inevitable, says Metropolitan Police Commissioner Sir John Stevens. His comments were echoed by Mayor of London Ken Livingstone, who says it would be "miraculous" if London escaped attack. Cabinet Minister Peter Hain says the UK is a " frontline target" for attack by international terrorists.
While they are not necessarily envisaging a CBRN attack, the possibility and potentially devastating nature of such an event cannot be ignored by any well-organised claims operation. Potential scenarios include the following:
Catastrophes, yes, but unlike any we have seen before with some very different challenges:
The Home Office website (www.homeoffice.gov.uk/terrorism/index.html) provides a range of useful information on the terrorism threat and the government response. In addition, a link to the UK Resilience site (www.ukresilience.info) provides up-to-date news and guidance as well as a range of other useful links. Pool Re is also active in examining insurer plans for terrorist responses and a close partnership is important.
All this means that claims directors need to ensure they have specific plans to deal with all terrorist attacks, including CBRN. These must be robust enough to cater for a variety of scenarios, for example:
As insurers review their catastrophe response plans, it is also important that opportunities for collaboration across the industry are not overlooked. it
' Rod Kitchen is claims director at Royal & SunAlliance