The heightened state of terror alert in the US, as well as reports of possible terrorist attacks in the UK, has had little effect on rates for terrorism cover due to the softening market.

One Lloyd's broker said this week that despite reports of planned attacks against the US and potential plots in the UK, rates were remaining stable due to the Terrorism Risk Insurance Act (TRIA).

"The market has softened due to the advent of TRIA," the broker said.

The US Treasury recently announced plans to extend the 'make available' provision of TRIA, which was due to expire at the end of this year, to the end of 2005.