Political violence losses and logistical challenges for claims

Political instability is not a new feature of human existence and war, civil war and terrorism have plagued societies in every region of the world for millennia. Damage assessments for reinsurers in the London Market and the past five years have been exceptionally busy.

Claims related to conflicts in Ukraine are ongoing, and we have also received claims in Sudan, Israel and Gaza. More recently, instructions for losses in Lebanon are being inspected. Recent political instability in east Africa has also highlighted the need for CTA’s assistance to Reinsurers there.

In-person loss surveys

It is exceptionally difficult to place and look after professionals in a country at war, embroiled in civil conflict or riven by terrorist activity. And this is before addressing the challenges of providing the technical support they need to carry out their work effectively.

Claims related to conflicts in Ukraine are ongoing, and we have also received claims in Sudan, Israel and Gaza.

In addition to the need for detailed planning, it is necessary to monitor and assess the evolving situation in real time and to have the protocols and resources in place to enable teams to adapt plans at a moment’s notice.

Professional security consultants play a vital role in providing in-depth risk data on the location of a loss and the nature of the changing dynamics within the area. They also provide specialised resources such as armour-plated vehicles where required and trained military personnel to accompany adjusters.

For instance, a case in Ukraine involved assessing a site about 100km from the front line and the insured building had suffered damage from artillery fire. Ensuring an adjuster can be onsite for a short window of just six hours involved a five-day trip and extensive travel arrangements to comply with the requisite safety protocols.

The intense level of planning required to establish exactly how and when adjusters can attend such claims rests on an established network of colleagues and partners around the world. Without such a network, it is virtually impossible to look after adjusters in the field appropriately.

In-person inspections in Israel have taken place following the outbreak of conflict in October 2023. A team from CTA attended various sites in southern Israel and obtained eye-witness accounts of the Hammas attacks.

Technology at play

The risk and volatility associated with some locations means physical surveys are simply not feasible. One example involved a severely damaged manufacturing facility outside Mariupol in Ukraine, where damage assessment was conducted remotely using technology to deliver a layered, sophisticated, five-step approach.

1. Site overview: High-quality satellite imagery of the premises to get an accurate overview of the location. These images are inexpensive and readily available, they provided details of the site’s layout and gave an indicative view of the condition of the roof.
2. Building function: Site plans were obtained from the insured and overlaid onto the satellite images to better understand the operational mechanics of the facility. Construction drawings were also secured from the plant owner to understand the materials and techniques used to construct the various buildings.
3. Plant and equipment: The insured’s asset detailed the onsite plant, machinery and equipment, as well as information on what it was used for and where it was located.
4. Damage assessment: A former British Army explosives expert in our network provided detailed information on the ordnance used, the properties of each and the explosion patterns they created over specific areas.
5. Data aggregation: Piecing all the data together enabled a precise assessment of where artillery had struck the insured facilities, the power of the explosions and the likely resulting damage given the structural composition of the building.

This layering technique is highly adaptable to the specific circumstances of an individual loss and to maximise the technology available, whether that be satellite imagery or loss modelling software. 

In some cases, the services of a specialist ex-military team on the ground were deployed during a civil war conflict to gather information. Human intelligence such as this is rarely used and not without considerable danger to the proxy team deployed.

The process has further developed into the formal use of highly sophisticated digital intelligence. Specialist consultants in the field of intelligence gathering which includes open source intelligence and image intelligence is now common place.

Political violence claims are a highly specialised area of the loss adjusting sector and one that has rarely been in more demand given the volatile nature of today’s world. 

As geopolitical tensions persist, the ability to assess damage in conflict zones with speed and accuracy is essential.

Additional material provided by Shazia Rehman, director, onshore energy and mining, natural resources, at Charles Taylor