Retail and hospitality sectors face rising terrorist threats
Relaxed COVID-19 measures will lead to crowds returning to public places, making them attractive targets for attacks.
The retail and hospitality sector has been a major target for terrorist actors for several years. As the COVID-19 vaccination process progresses, more businesses will reopen fully, which means a busy retail and hospitality sector. The relaxed COVID-19 measures will lead to the return of crowds to publicly accessible places, such as high streets, shopping malls and hospitality hubs, which usually attract people in large numbers and close density, making them attractive targets for terrorist actors.
Steve Coates, chief underwriting officer at Pool Re, told PropertyCasualty360.com that even if a business is not a specific target, it could still be affected.
“If crowds gather or there is a notable venue in the vicinity of your business, such as a tourist attraction, your business may not be the specific target, but the knock-on effects could certainly be damaging,” he said.
Pool Reinsurance conducted a study to better understand the terrorist threat to the retail and hospitality sector, so owners and managers can effectively manage and mitigate the risk. Here are the key findings:
- The threat of terrorism is not exclusive to cities and major towns. More attention should be given to potentially less secure sites in suburban and rural areas.
- Crowding and density represent attractive targets for terrorists, who prefer to use low complexity methodologies, such as vehicular and bladed weapons attacks, because they are quick to plan, easy to execute, and hard to detect and prevent. Those seeking to cause mass casualties and/or significant damage and disruption may also use more sophisticated methodologies, such as bombings.
- A terrorist attack against the retail and hospitality sector is likely to cause disruption to local economies and damage public confidence. An attack could lead to a significant drop in sales and footfall, which could last several months.
- Even localized attacks can affect the wider economy and could lead to a decline in consumer spending, hotel reservations and flight bookings, and, ultimately, Foreign Direct Investment.
- The threat of terrorism to the sector stems mainly from Islamist extremist actors, although far-right, far-left and Violent Dissident Republicans (VDRs) have displayed the intent to target retail and hospitality businesses.
- The British Government is considering a ‘Protect Duty’ legislation requiring business owners and operators in the retail and hospitality sector to do more to understand and mitigate the threat of terrorism to their businesses.
“For more complex businesses or locations, liaison with the police and neighboring businesses will help identify whether additional measures are required. Undertaking more informed assessments will help analyze the risks in greater detail and will ensure critical vulnerabilities are identified,” Coates asserted, stressing its importance in the current easing of lockdown where many businesses are serving customers outside.
Social distancing measures have created new vulnerabilities, such as external queuing and dining. Additionally, many businesses in the sector have lost experienced staff and have redirected scarce resources away from counterterrorism and security investment. As a result, terrorism is currently very low on businesses’ agendas.
“These activities could be creating additional vulnerabilities for members of the public and employees due to the threat of an attack using a vehicle as a weapon, especially if there are no protective street bollards in place. A better understanding of what could happen might help reduce the vulnerability rather than create one,” Coates said.
The Insurance industry could also be affected as “liability insurers may face claims under their employers or public liability policies where their policyholder is alleged to be negligent and such lack of care has contributed to the terrorist attack in some way,” Coates said. He added that what the pandemic has illustrated is that when catastrophe strikes, those businesses who have business resilience embedded in their strategy and activities will generally outperform the businesses that have not invested in such planning.”
Coates cited the 2017 Westminster terrorist attack where claims made against insurers of the rental car used in the attack led to reinsurers withdrawing terrorism personal injury cover on motor treaties which led to the risk being transferred to the Motor Insurers Bureau (MIB). He said it shows that claims can also be brought against other classes of cover, such as D&O and motor.
Trudy Knockless is an award-winning reporter, writer, editor, author, and online talk show host with a background serving legal and insurance publications. Born and raised in Jamaica, Trudy currently resides in New York with her daughter and mother and hosts an online program titled “Conversations with Trudy,” which streams live on Facebook every Wednesday at 8 p.m. EST and also airs on Newstalk 93 FM in Jamaica and Caribbean Vibes Radio in New York. The program aims to break stigmas, offer perspectives on taboo subjects and provide a safe space for open dialogue for participants and viewers.
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