TERRORISM RISK: A CONTINUING THREAT Impacts for Property/Casualty Insurers SEPTEMBER 2012 Robert P. Hartwig, Ph.D., CPCU President & Economist (212) 346-5520
[email protected] Claire Wilkinson (917) 459-6497
[email protected] Insurance Information Institute 110 William Street New York, NY 10038 212.346.5500 INTRODUCTION International terrorism—starting with the terrorist attack of September 11, 2001, and followed by the 2002 Bali bombings, the 2004 Russian aircraft and Madrid train bombings, the London transportation bombings of 2005 and the Mumbai bombings of 2008—had a profound influence on the 2001 to 2010 decade. Then came 2011, a landmark year, which simultaneously saw the death of al-Qaida founder Osama bin Laden and the 10-year anniversary of September 11. The changing nature of the global terrorism threat is highlighted in a report from the U.S. Department of State, which notes that the total number of worldwide terrorist attacks in 2011 was more than 10,000 in 70 countries, resulting in more than 12,500 deaths.1 While large, that figure represents a drop of 12 percent from 2010. More than 75 percent of the world’s attacks occurred in South Asia and the Near East, and 85 percent of attacks in these regions occurred in just three countries: Afghanistan, Iraq and Pakistan. Bin Laden was not the only top al-Qaida leader removed from the battlefield in 2011. Other key terrorist figures killed in 2011 included: Ilyas Kashmiri, a terrorist operative in South Asia; Harun Fazul, an architect of the 1998 U.S. Embassy bombings in Kenya and Tanzania; Atiya Abdul Rahman, al-Qaida’s second-in- command after bin Laden’s death; and Anwar al-Aulaqi, al-Qaida’s chief of external operations in the Arabian Peninsula.