The risk of terrorism and non-damage BI remains high, warns German insurance buyers’ association

GVNW is calling on the German government to extend its support of terrorism risk pool, EXTREMUS AG beyond 31 December 2022, the date when it is currently due to expire. 

In a letter, issued jointly with the Federal Association of German Industry (BDI), Stefan Rosenowski, managing director of GVNW asks the Federal Ministry of Finance for an early extension of the state guarantee. 

In particular, the risk and insurance association notes the deteriorating geopolitical landscape and warns the risk of terrorism attacks remains high.

In the absence of federal support, it is unlikely there will be a viable future for the terrorism risk pool.

Without a public backstop, availability of terrorism re/insurance and non-damage business interruption (NDBI) from the private market will be insufficient, it warns. There is a real risk that pricing would harden considerably, in such a scenario, as capacity wanes.

GVNW notes that previous terror attacks on German soil (including the 2016 truck attack) have had a devastating impact, including losses resulting from business interruption and supply chain disruption.