Delhi Blast Raises Key Question: Does Your Insurance Policy Cover Terrorist Attacks?
The recent blast near Delhi’s Red Fort on November 10, which claimed eight lives and injured over 20 people, has once again raised an important question — does your insurance policy cover damages or losses caused by terrorist attacks? The answer depends on the type of insurance you hold and whether it includes a terrorism risk cover.
It’s a common misconception that every insurance plan automatically covers terrorist attacks. In reality, most regular insurance policies exclude terrorism-related damages unless you have specifically opted for an additional rider or bought a separate terrorism cover policy.
In India, both life and non-life insurance policies offer such covers, but only on specific terms. For instance, in motor or property insurance, terrorism coverage often requires an extra premium payment.
To ensure financial protection against such risks, all non-life insurance companies in India jointly formed the Indian Market Terrorism Risk Insurance Pool (IMTRIP) in April 2002. This initiative came after global reinsurers withdrew terrorism coverage following the 9/11 attacks in the U.S.
The pool is managed by GIC Re (General Insurance Corporation of India) and provides reinsurance support to insurers covering terrorism-related losses. It operates on a risk-sharing model, where every participating insurer contributes to the fund.
Contribution: All non-life insurance companies contribute to IMTRIP.
Claims: When a terrorist attack occurs, claims related to terrorism are settled using this pooled fund.
Coverage Limit: The pool provides coverage of up to ₹2,000 crore for any single location.
Beyond ₹2,000 crore: Those requiring higher coverage need to purchase a standalone terrorism insurance policy.
In FY 2023–24, IMTRIP collected ₹1,654.63 crore in premium income and settled claims worth ₹3.12 crore, reflecting its crucial role in managing large-scale risks.
Property Insurance:
If your home, office, or business premises are insured under a property insurance plan with terrorism coverage, damages caused by a terrorist act will be compensated.
Motor Insurance:
A comprehensive car insurance policy may cover terrorism-related damages if the terrorism rider is included.
Life Insurance:
Most life insurance policies in India include coverage for deaths caused by terrorist attacks. If the insured person dies in such an incident, the nominee is eligible for the full death benefit, unless the policy explicitly excludes it.
Health Insurance:
Some health insurance plans may reimburse hospitalization expenses due to injuries sustained in a terrorist attack, depending on the policy’s terms.
Insurance experts strongly advise reviewing your policy document to confirm whether terrorism-related damages are covered. The exclusions section will clearly state if the coverage applies or not.
If your policy does not include terrorism cover, you can opt for an add-on rider by paying a small additional premium. This can ensure full protection against unforeseen losses in such tragic events.
Salary Account Holders or Term Deposit Customers in certain banks may automatically enjoy broader coverage linked to their financial products.
For standalone insurance plans, you must manually include terrorism coverage when purchasing or renewing the policy.
Terrorism incidents not only cause loss of life but can also lead to severe property and financial damages. In densely populated cities like Delhi, Mumbai, or Bengaluru, where commercial and residential zones are tightly packed, even minor blasts can result in substantial monetary loss.
Having a terrorism rider or IMTRIP-backed insurance plan ensures that such losses are financially covered, helping affected families and businesses recover faster.
If you’re unsure whether your life, health, home, or vehicle insurance covers terrorist attacks, now is the time to check.
While standard policies may not include this protection, adding a terrorism coverage rider or choosing a policy that participates in the Indian Market Terrorism Risk Insurance Pool (IMTRIP) can safeguard you from unexpected financial shocks.
In today’s uncertain world, a small extra premium for terrorism cover can provide huge peace of mind in times of crisis.
