The Auatralian government stated to help securing businesses against terrorism attacks through terrorism insurance in 2003.
The government stated to help securing businesses against terrorism attacks through terrorism insurance in 2003 when firms did not get the coverage following 9/11 attacks in United States of America.
The policy forces insurers to cover terrorism threats by nullifying exclusion clauses. This scheme allows insurers to reinsure any risk of terrorism with Australian Reinsurance Pool Corp, founded to control the policy.
According to Peter Costello, Treasurer, providing insurance for terror threats would be in short supply and costly, and could result in weakening of economy and business investment.
Costello said in an interview that terrorism could not be related to religion. He said that terrorism is wrong and terrorists will always be considered guilty irrespective of religion.
Govt. plans to review and refine this scheme after a legislation urged in continuation of scheme with some alterations. Many recommendations were seen regarding the expense of reinsurance.
"With new refinements lining up for terrorism insurance, cost will be a major challenge that the revised scheme will be looking forward to counter", said an analyst at RNCOS.
Costello predicts that the alterations would allow higher involvement of commercial markets. He said that encouraging involvement of commercial market is the key to success of the scheme.
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