Blog Coverage AIG Raises its Property Terrorism Insurance Coverage to $1 Billion and Unveils Global Terrorism Risk Engineering Services

LONDON, UK / ACCESSWIRE / October 27, 2016 / Active Wall St. blog coverage looks at the headline from American International Group, Inc. (NYSE: AIG). The company announced on October 26, 2017, that it has raised the property terrorism insurance coverage limits across the globe to $1 billion. Clients, who want a higher coverage, would be catered to on a standalone basis or through AIG’s Large Limits property insurance which offers insurance coverage for all risks including terrorism for up to $2.5 billion per occurrence. Register with us now for your free membership and blog access at: http://www.activewallst.com/register/.

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Commenting on the expanded limits, George Stratts, President of Property and Special Risks at AIG said:

“This coverage provides our clients with market leading capacity that will respond to terrorist attacks worldwide. Demand from our clients for better protection against this risk has been strong. With our reinsurance partners and the investments we have made in analytics and risk engineering, we are confident in our ability to meet this demand and help our clients better prepare for, mitigate, and manage a terrorism event.”

What is Terrorism Insurance?

The Terrorism Risk Insurance Act (TRIA), which was enacted by Congress in November 2002, in the aftermath of 9/11, established a public-private partnership between the U.S. federal government, private insurers, and all commercial enterprises operating on U.S. soil. The Act was renewed and modified in January 2015, wherein it was mandated that insurers offer terrorism insurance to their commercial policyholders while providing the insurers with financial protection up to $100 billion against terrorist attacks in the U.S.

Terrorism insurance is offered separately or as a special “rider” to a standard commercial property insurance policy. A commercial terrorism policy covers damaged or destroyed property – including buildings, equipment, furnishings and inventory. According, to a rough estimate 60 % of U.S. businesses have terrorism insurance.

Background

Growing incidents of terrorism across the world has created a demand for insurance cover. Businesses that are present in large cities or those that have multi-national presence are increasingly aware of the risk and are concerned about safety. This has created a demand for the product in this niche area. AIG is looking at servicing such clients who are looking for an insurance service provider who can mitigate a wide range of risks including those arising from acts of terror.

Prior to this announcement, AIG’s property terrorism insurance coverage was $ 250 million and was mainly focused on centrally located business locations in major urban areas.

AIG’s Global Terrorism Risk Engineering Services

AIG has started a new and proprietary terrorism risk engineering services which offers data analytics, risk engineering capabilities, and enhanced risk selection tools. This will aid AIG in expanding its appetite for terrorism risk.

These services came into play due to a strategic investment made by AIG in 2015 wherein it had partnered with Clemson University to establish a risk engineering and systems analytics center. The Centre helped more than 600 engineers to enhance their skills and capabilities at the same time AIG benefited from their efforts to transform data analytics into practical tools that were useful for AIG and its clients.

In July 2016, AIG had launched CyberEdge Plus a standalone policy which offered insurance protection for a broad range of cyber risks, including property damage, bodily injury, business interruption, and product liability.

Stock Performance

Investors welcomed the new product offering and their enthusiasm was reflected in the stock’s recent performance. On Wednesday, the stock closed the trading session at $61.11, slightly climbing 0.92% from its previous closing price of $61.11. A total volume of 6.55 million shares have exchanged hands, which was higher than the 3-month average volume of 5.50 million shares. American International Group’s stock price advanced 4.44% in the last month, 12.14% in the past three months, and 10.68% in the previous six months. The stock has a dividend yield of 2.09% and currently has a market cap of $65.50 billion.

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