Terrorism Insurance: Do you need it? - WSLS 10 NBC in Roanoke/Lynchburg Va

Terrorism Insurance: Do you need it?

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How close could terrorism come to Florida's beaches, airports, or sports stadiums? It's why local police train for such events and why those local agencies have created a Terrorism Task Force.

But it's also causing some business owners to ask a question they likely never would have 15 years ago: Do I need terrorism insurance?

"I think that's why you have insurance, right: You never know when something will happen," said Kristy Williamson, owner of Vida De Café in Pass-A-Grille, the laid back beach community on the Pinellas coast.

Williamson decided to opt out of terrorism coverage this year.

"Every single business every year is offered the opportunity to buy terrorism coverage," Bob Hartwig, President and Economist for the Insurance Information Institute in New York. "That's actually a requirement of the law."

The need to offer it came after the September 11 attacks in New York.

"In exchange for the government coming in and providing a financial backstop against very large-scale terrorist attacks, insurers were required to offer the coverage," Hartwig said.

Now if three federal agencies (U.S. Secretary of Treasury, Secretary of State, and Attorney General) certify an attack as an act of terrorism, businesses must have opted for the insurance for their policies to cover damages.

"For your average business in your average city - talking about a small business - it could be $25, $50 a year ... $100 a year," Hartwig said. "Most businesses are at very low risk and they don't have a lot of property at risk."

Larger businesses or higher-profile structures like airports, theme parks or sports stadiums will pay higher premiums; into the thousands sometimes.

"It would only cost your average business owner in the Tampa Bay-Clearwater area a few dollars to buy that coverage," Hartwig said. "It buys peace of mind and a place like Florida could be attractive to terrorists in the future as they increasingly move towards softer targets all across the country."

But small business owners like Williamson have paid close attention to every dollar these last few years. Not only is Florida climbing out of a recession but many of the small businesses here close to the coast are paying for wind and flood insurance.

Will she buy into terrorism coverage?

"Depends on the deductible," Williamson said. "If it's going to cost me more money - then why would I do it?"

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