March 28, 2016 by Canadian Underwriter
The terrorism bomb blasts last week in Brussels “are a somber reminder of the difficulty of preventing attacks against transportation infrastructure such as airports and metro or bus stations,” notes catastrophe risk modelling company Risk Management Solutions (RMS).
“As security at military bases, embassies and other government facilities increases, there has been a trend among terrorists in targeting softer targets such as public transportation infrastructure,” notes observations released Friday by RMS, which provides models and software to help financial institutions and public agencies evaluate and manage catastrophe risks.
Two suicide bomb attacks occurred Mar. 22 at the Brussels International Airport departure area (reports have revealed one improvised explosive device, or IED, was detonated at the American Airlines ticket counter), with another suicide bomb attack occurring about an hour later in a train near the Maelbeek metro station, not far from the city’s main European Union buildings and the U.S. Embassy.
Although simple, RMS points out the attacks were highly effective. “The bombs were detonated in small confined areas, a perfect place for a mass casualty event when leveraging a small IED,” the firm adds.
Attacks on public facilities “are intended not only to kill, maim and disrupt, but they are also meant to inflict debilitating psychological scars and foster a sense of insecurity among the population and the feeling that the government is unable to protect citizens,” Jonathon Green, a risk consultant at AIR Worldwide, notes in a statement from the catastrophe risk modelling organization.
“As a result of the attacks – which took place just days after the capture of Salah Abdeslam, a suspect in the massive and co-ordinated terrorist attacks in Paris Nov. 13 – Belgium raised the terror threat level to four, its highest level,” Green says. The co-ordinated attacks are reported to have claimed the lives of 33 people and wounded 260 others.
The events also shut down flights and prompted the Brussels metro system to discontinue service for a time. That said, the “governments’ prompt recovery is important to those who have been attacked. Reopening train stations, shops and businesses – as well as a recovering stock market – are positive signs after such as assault,” Green suggests.
As with the Nov. 2015 Paris attacks, AIR Worldwide reports the events in Brussels are expected to have limited impact on the insurance industry. Damage to buildings is expected to be minimal, resulting in limited insured property losses.
“A little emphasized, but very important, aspect of these attacks is the involvement of brothers,” comments Gordon Woo, a catastrophe risk expert at RMS. “Brothers have also been involved in several recent terrorist atrocities: the Boston marathon bombing on Apr. 15, 2013, the Charlie Hebdo attack in Paris on Jan. 7, 2015 and the Paris attacks on Nov. 13, 2015,” Woo reports.
“Keeping a plot within the family (as was also the case for the San Bernadino terrorist attack on Dec. 2, 2015) helps maintain secrecy and makes surveillance and plot interdiction more difficult,” he explains.
Of particular concern among European security agencies are foreign nationals who travel to war zones, RMS suggests, such as Iraq, Syria, Somalia or Yemen, with the intent to take part in the conflict or join jihadi training camps. “Belgium, with the largest number of foreign jihadi fighters in Iraq and Syria in absolute and relative terms, is at considerable risk,” RMS cautions.
“Following a series of devastating bombings and shootings around the world in recent months, including the attacks in Brussels this week, the likelihood of a major terrorist attack is set to remain high,” notes a statement announcing the availability of a new joint viewpoint report out of London from JLT Re, part of the Jardine Lloyd Thompson Group plc, and JLT Specialty Limited.
The report suggests insurance is absorbing only a fraction of the economic impacts of terrorist attacks. “Terrorism has evolved into a more complex threat for businesses and insurers, with both attacks and fatalities seeing steep increases since 2011,” Chris Holt, head of credit, political and security risk consulting for JLT Specialty, says in a statement.
“But this isn’t just about an increase in activity. The rise of Islamic extremism, combined with the potential access to weapons, explosives and toxic materials, comes at a time when modern communications and technologies are being exploited by groups as recruitment tools, communication channels and potential attack vectors,” Holt continues. “This means today’s terrorist threat is more dynamic with impacts that are difficult to accurately predict.”
“The market has been slow to respond and the fallout from several recent attacks has reinforced the need for new products,” suggests Paul Upton, a partner with the marine, energy and political risk unit for JLT Re.
“What has happened in Brussels has happened, unfortunately, already in Paris, in Madrid, in London, but also outside Europe in Turkey, Lebanon, Tunisia, Mali – and the list unfortunately goes on,” Commissioner Dimitris Avramopoulos of the European Commission said following the attacks. “But precisely because it has happened before, we know that each time, the citizens of these cities, the citizens of Europe, have come out stronger and more united,” Avramopoulos said during a college meeting Mar. 23.
“We cannot keep learning the hard way, but the events in Brussels show, once again, that we absolutely need more co-ordination and more information exchange. The fact that the perpetrators of the Paris and Brussels attacks were known to the police proves this once again,” he emphasized.
“Information gathering and information exchange are the cornerstone of our security. Our information needs to be inter-connected. Our systems need to talk to each other. That is where we need to improve, urgently,” Avramopoulos added.
Following the attacks in Brussels, AIR Worldwide reports that authorities beefed up security in the United Kingdom and France, and at borders throughout Europe. “Also, security was enhanced in Asia – where some governments have been on high alert since terrorist attacks in Jakarta, Indonesia, in January – and in New York, Washington, D.C., Chicago, Los Angeles and other major U.S. cities,” the statement adds.