Insurers are imposing war and terrorism exclusion in income protection insurance, according to Mercer Human Resource Consulting.
But the exclusion is unworkable in its current wording, the consultant said.
As a result, the company is attempting to get such exclusions removed.
This comes in the wake of the 11 September tragedy, where insurers have been alerted to protect their solvency in the event of catastrophic loss.
Some insurers have decided to impose a maximum exposure limit of £100m per event or even for the geographic location.