LMA 3030 terrorism wording (T3)

When a property policy excludes terrorism, as most have done since 2001 outside national pools, the buyer buys the cover back in the standalone market, mostly in London. The wording he receives most often is numbered LMA 3030, which the market calls T3. It covers physical loss or damage caused by an act of terrorism or sabotage. An act of terrorism is the use of force or violence, or the threat of it, by a person or a group for political, religious or ideological purposes. The aim can include influencing a government or putting the public in fear. The exclusions do the real work. No nuclear, no chemical or biological, no war, no attack by electronic means, no consequential loss: loss of use, delay, loss of markets or income. Business interruption is bought separately, often with a radius around the site. An underwriter reading a T3 looks at two things: the schedule of locations with their values, and the distance to the nearest landmark building, because accumulation is counted in circles a few hundred meters wide. Riots, insurrection and war come in by extension, on another wording: it is then a political violence policy.

• Lloyd's Market Association, LMA 3030, Terrorism Insurance Physical Loss or Physical Damage Wording