Best’s Special Report: Insurers Create New Types of Coverage for Mass Shooting Attacks
July 16, 2019 by Best's Insurance News & Analysis
Oldwick – In the wake of a marked increase in mass shootings in the United States in recent years, more insurers have responded to rising demand and have begun offering active assailant insurance coverage, which carries unique features over traditional general liability policies, including risk assessment and crisis management services.
The new Best’s Special Report, titled, “Insurers Create New Types of Coverage for Mass Shooting Attacks,” states that 250 active shootings took place between 2000-2017, with an escalating trend during that time frame, according to the FBI. Active shooter attacks differ from acts of terrorism, which typically target specific buildings or locations and trigger coverage from traditional terrorism policies that require property damage for coverage to apply. The standard terrorism policy also requires that the motive be ideological, political or religious in nature, unlike active shooter attacks, for which the motive may be personal or unclear.
The costs following an active shooter attack can be substantial, and some insureds do not realize that their policies do not cover active shooting incidents; they may believe that this type of attack falls under terrorism coverage but it does not. Additionally, a property policy is designed to handle the physical damage of an altercation, but general liability sections do not clearly include or exclude active shooter incidents—a concern for companies that are left footing a huge bill after this type of incident. This gap in general liability policies, as well as marketplace demand, has provided insurers an opportunity to offer traditional named perils coverage for a new category of risk. In some cases, schools can seek solutions via captive insurance vehicles by pooling their liability exposure to these types of events with those of other schools.
Click HERE to read the full article via AM Best.
