Insuring the Risk of Terrorist Damage and Other Hostile Deliberate Damage to Property Involved in the Marine Adventure: An English Law Perspective

The World Trade Center attacks on September 11, 2001, brought into stark relief the massive property losses that might be caused by an act of terrorism. However, on the basis that it is people, rather than property, who are the principal target of terrorism, the risk of a terrorist attack on, and consequent physical damage to, a commercial vessel and her cargo whilst at sea is relatively low. Nevertheless, the risk of damage to marine property done deliberately and aggressively and outside situations of actual war does exist, and protection against the consequences of such damage has long been available in the English marine insurance market. This Article categorizes such risk as the risk of damage by “hostile deliberate acts.” It provides an overview of the historical developments of the English marine insurance market and describes the overall framework of the insurance cover that is available in respect of damage by hostile deliberate acts: It covers the standard clauses applicable to hull and cargo risks, and it considers the top up or alternative cover available from the P & I Clubs and War Risks Associations. It also considers each of the hostile deliberate act perils in detail, namely the “marine perils” of piracy, violent theft by persons from outside the vessel and barratry, and the “war perils” of seizure, riots, malicious acts, and acts of terrorists or persons acting from a political motive.