Terrorism Insurance (Hansard, 22 January 2003)

§ Lord McIntosh of Haringey
My Lords, the Reinsurance (Acts of Terrorism) Act 1993 has successfully underpinned government involvement in the Pool Re scheme to enable insurers to offer terrorism insurance for commercial property damage and business interruption. Following 11th September 2001, a government and industry working group was set up to examine changes needed to Pool Re, and the remit of the Pool Re scheme has been extended to enable insurers to offer terrorism insurance against a wider range of risks. This has been widely welcomed as an example of partnership between government, the insurance industry and property owners and occupiers.

§ Lord Lloyd of Berwick
My Lords, I thank the Minister for that reply. However, is he aware that there is still concern in the City about a gap in the terrorism reinsurance cover provided by the Pool Re arrangements because of the fact that the definition in the 1993 Act is a good deal narrower than the definition in the Terrorism Act 2000? In those circumstances, can he perhaps reassure the House that serious damage to property caused by bodies such as the animal rights movement is covered by Pool Re? Can he give the same assurance in respect of terrorist acts committed by persons not known to be acting on behalf of any known organisation?

§ Lord McIntosh of Haringey
My Lords, I shall, if I may, answer the general question and then the two specific questions that the noble and learned Lord, Lord Lloyd, asks. Yes, of course there is a gap between the definitions. However, we take the view that is a very small set of circumstances and it does not justify primary legislation. That view was upheld by all the parties in the recent agreement to extend Pool Re.
On the specific point, of course, I cannot make a judgment about particular cases. However, if we talk about the animal rights movement, I think that, in general, it would be accepted that it is seeking to influence government by violence to change the law on animal rights. But, of course, any individual case would have to be judged on its merits. Ultimately, these are questions for the Treasury to determine in accordance with the Pool Re arrangements, with a right of appeal to an impartial tribunal.
As for the question of acting on behalf of an organisation, the definition is explicit in saying that the act must be on behalf of or in connection with the organisation. That is a little wider and may give some comfort to the noble and learned Lord, Lord Lloyd.

§ Lord Newby
My Lords, does the Minister have any sympathy with the argument that the scope of the acts 695 might be expanded to provide public liability cover? Does he agree that if there were a terrorist attack, for example, at a football match, the club would be covered for the physical damage to the ground and the loss of future revenue, but not for claims in respect of spectators killed or injured by the attack? Do the Government believe that that is an acceptable situation?

§ Lord McIntosh of Haringey
My Lords, there are many, many ways—an infinity of ways—in which the protection and the government underpinning could be extended. For example, it could be extended to domestic properties, although it has not been. I think that a line has to be drawn somewhere, both in terms of the definition of terrorism and the degree to which the Government should be underpinning what is fundamentally a contract between insurers and insured.

§ Lord Saatchi
My Lords, is it not undesirable in principle for there to be two Acts of Parliament on the statute book with two different definitions of terrorism? Will the Minister say a little more about the Government's reluctance to bring the definition in the 1993 Act into line with the definition in the Terrorism Act 2000, which includes references to religious and ideological causes, threats and intimidation, risks to health and safety and disruption of electronic systems—all modern forms of terrorism about which the 1993 Act is understandably silent?

§ Lord McIntosh of Haringey
My Lords, yes, there are differences between the 1993 Act and the Terrorism Act 2000, but our view is that the differences in practice are likely to be very small. However, particular circumstances could give rise to an act of property damage not being covered. In so far as differences of definition are significant, it is generally the Terrorism Act 2000—the more recent Act—that will prevail.