Insurance for Terrorism Still a Rarity

With government officials warning of renewed terrorist attacks in the United States, most of corporate America still has no insurance coverage for acts of terrorism. Last fall, at the insistence of President Bush, Congress provided federal support for insurance companies, and they began offering the coverage in late November. But few corporations in New York, Washington, Chicago or other big cities — where the authorities say attacks are most likely — have bought the coverage. Many corporations say the coverage is too expensive, according to insurers, especially since the federal government has agreed to pay most of the losses in a major attack. They also say that while the insurance provides economic protection against bombs and many other kinds of violence from foreign terrorists, it does not cover attacks by American extremists or attacks by anyone with nuclear, chemical or biological weapons. Full Story