Airline passengers face a greater danger of becoming victims of terrorism as a result of the war against Iraq, insurance experts warned.

Peter Butler, outgoing chairman of the Aviation Insurance Offices Association (Aioa), said airliners were a " favoured target " for terrorists seeking to retaliate against the US-led attack on Iraq.

He said: " The perception is that the threat has to have increased and the retaliation is likely to be of a terrorist nature. Whether it will be against aviation or not, who knows, but it does seem that aviation is a favoured target, and that's the worrying bit. "

Butler was speaking at the last meeting of the Aioa as an independent association. It voted to become the aviation committee of the IUA.

Incoming chairman Nick Brown, senior vice president of AIG Aviation, said: " If we are going to be realistic, e have to say there's a very real threat to the airline industry and everybody -including insurers and the travelling public -has to be aware. "

He warned that terrorists would be looking for the " CNN factor " -causing enough devastation to grab headlines and horrify the world.