AIG Terrorism White Paper

Global terrorism: On high alert!

A changing terrorism MO and what it means for your business

in association with RUSI and NYA International

 AIG Terrorism White Paper

Terrorism remains a significant threat to businesses and communities

the world over and does not just take one form. ISIS is currently the
most active group after entering a new phase of inciting attacks
beyond its immediate borders in 2015. AIG, in partnership with
the Royal United Services Institute (RUSI) and NYA International,
considers what this means for businesses, how the threat could
manifest itself and how organisations should prepare.

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Part One: From hard to soft targets... how and

why terrorists made the shift

ISIS may be losing territory but it retains an ability to inspire individuals and groups outside of
its heartlands in Iraq, Syria and Libya. This was evident in the most recent ISIS-inspired attacks
in a Berlin Christmas market and an Istanbul nightclub. The threat posed by returning foreign
fighters is also increasing.

While it can be argued that civilians have always been targeted in terrorist attacks – with nearly The Global Terrorism Index defines
3,000 people killed on one day in the 9/11 attacks 15 years ago - the intention to target civilians terrorism as:
by groups such as ISIS has never been as explicit or so easily communicated. These terrorist
groups increasingly look to inspire acolytes through deft online propaganda videos. “The threatened or actual use
of illegal force and violence by
Since the Mumbai marauding attacks of 2008, groups such as ISIS, Lashkar-e-Toiba and a non‐state actor to attain a
Al-Shabaab have increasingly shifted attention to soft targets. The Mumbai attacks political, economic, religious,
demonstrated how several well-armed individuals with small explosive devices and automatic or social goal through fear,
weapons could cause significant loss of life by attacking a heavily-populated area and easily coercion, or intimidation”.
accessible public buildings.
This definition recognises that terrorism
In many ways Mumbai was a major precedent, inspiring subsequent marauding terrorist firearms is not only the physical act of an attack,
attacks (MTFA), including those in Nairobi 2013, Tunisia June 2015, Paris November 2015 and but also the psychological impact it has
Istanbul on New Year’s Day 2017. Armed assaults – used in around 20% of all terrorist attacks – on a society for many years after.
are more deadly than other forms of attack. Just over half of attacks on civilians utilise bombings
and explosions. In 2015, there were over 12,500 civilian deaths arising from terrorist attacks, an
increase of 550% since 2000 i.
Top trends in terrorism
(source: Global Terrorism Index)
Terrorist organisations such as ISIS are
actively encouraging their followers to • P rivate citizens and soft targets
(e.g. restaurants, shopping
target civilians in Western countries malls, museums and hotels) are
increasingly targeted
• I mprovements in counter-terrorism
Fig 1 Deaths from terrorism, 2000-2015 surveillance have increased the
Iraq Afghanistan, likelihood of more complex plots
2015 saw the first reduction in terrorism since 2010, although
Pakistan and Syria
it was still the second worst year recorded for terrorism being intercepted
Nigeria Rest of the world
• T wo groups - Boko Haram and
35,000
ISIL DECLARES ISIS - are responsible for half the
CALIPHATE
30,000 deaths from terrorism, with ISIS in
NUMBER OF DEATHS

US INVADE
particular encouraging attacks in
25,000 IRAQ
US TROOP
OECD countries
SURGE
20,000 SEPTEMBER 11
SYRIAN CIVIL
WAR BEGINS
15,000 US INVADE
AFGHANISTAN
10,000

5,000

0
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

(Source: START GTD, IEP calculations)

YEAR

i http://www.visionofhumanity.org/sites/default/files/Global%20Terrorism%20Index%202016_0.pdf

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Inspiring lone actors

Lone-actor attacks, such as those in Nice in 2016, Sydney in 2014 and The intention to target civilians
Norway in 2011, are the most frequent type of terrorist activity in the
Western world. This type of attack is responsible for 70% of all deaths [in terrorist attacks] has never
from terrorism in the West since 2006ii. In 2015 there were 33 lone been as strong, as explicit,
actor attacks in connection with ISIS, up from 13 in 2014.
or so easily communicated.
Until the end of July 2016, there were 22 ISIS-inspired lone actor
attacks, including the Nice truck attack which killed 85 and the
These attacks have demonstrated that a very real potential remains for
Orlando, Florida, night club shooting, which killed 50. More recent
complex operations to be planned and orchestrated. The attacks in
events include the truck attack by Tunisian Anis Imri in a Berlin Christmas
France, Belgium and Turkey were amongst the most devastating in the
market, which killed 12 people in December 2016, and the massacre of
history of these countries and, according to IEP, “reflect a disturbing
39 people by a lone gunman in a nightclub in Istanbul in the early hours
return of the transnational group-based terrorism more associated with
of New Year’s Day 2017.
al-Qaeda before and immediately after September 11”.
In RUSI’s analysis of lone-actor plots in Europe, nearly a third used
One reason behind the overt targeting of civilians is the goal of creating
firearms, 17% involved explosives and 12% involved blades. For
fear and chaos, and because most public targets are easy to access.
nearly a decade, Islamic extremists have encouraged the use of a
Higher per capita spending on counterterrorism vis-à-vis interpersonal
wide range of attacks. This includes those that are easy to carry out,
violence in countries such as the US and UK “underscores the impact
involving vehicles and knives, such as the Nice and Woolwich attacks
that the fear of terrorism has on the general population,” according to
(with attackers in the latter buying their main weapon from a home
the IEP. Meanwhile, empty beaches and resorts in Turkey and Tunisia in
improvement store).
the months immediately following attacks there, are also testament to the
In spite of the increased number of deaths from terrorism in the West, impact of this strategy.
2015 saw the first drop in overall deaths since 2010, due to the
Counter-terrorism surveillance is another reason for the changing
weakening of ISIS and Boko Haram in their core areas.
MO of attacks carried out by some terrorist groups. Because there is
a high likelihood of complex attacks being intercepted, some terrorist
Growing threat for OECD countries organisations are actively encouraging their followers to plan assaults
2015 was a particularly bad year for OECD countries, which involving fewer individuals. Therefore, terrorist groups such as ISIS
experienced a 650% rise (to 577 in 2015 from 77 in 2014) in the and AQAP seek to inspire smaller-scale attacks while also planning
number of fatalities resulting from terrorism, according to the Global ‘spectaculars’ like the Paris attacks in November 2015.
Terrorism Index 2016 (GTI), published by the Institute for Economics
and Peace (IEP). The majority of deaths occurred in Turkey and France An audio message released by the ISIS media arm al-Furqan in May
and more than half were in connection to ISIS, with attackers in Paris, 2016 urged sympathisers in Europe and the US to launch attacks on
Brussels and Ankara targeting crowded public places such as sport civilians if they were unable to travel to the group’s self-proclaimed
stadiums, transportation hubs, restaurants and music venues. caliphate in Syria and Iraq.

Fig 2 Deaths from terrorism in OECD countries, 2000 to July 2016

In 2015 deaths from terrorism increased by 650 per cent compared to 2014. This was the second worst
year for terrorism in the OECD after 2001 with the September 11 attacks.

600
The 9/11 attacks killed 2,996 people
NUMBER OF DEATHS

500

400
January - July

300

200

100

0
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 mid 2016

YEAR
(Source: START GTD, IEP calculations, IEP estimates)

ii http://economicsandpeace.org/wp-content/uploads/2015/11/Global-Terrorism-Index-2015.pdf

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The internet and social media has made it easier to influence and
gain access to the latest generation of susceptible individuals, with Fig 3 Deaths from attacks targeting private citizens, 2000-2015
ISIS often claiming lone self-radicalised attackers as “soldiers of the
There has been a 550 per cent increase in the number of deaths of private
Caliphate”. “(ISIS) uses the digital world to create an idealised version citizens from terrorism since 2000.
of itself, a reality show that is designed to find resonance and meaning
16,000
among its diverse supporters”, notes GTI. However, while social media
is an important tool, most radicalisation still involves real-world social

DEATHS FROM TERRORISM

14,000
interaction.
12,000

Fears remain that a large, meaningful attack could be waged by ISIS 10,000
on the West in retribution for the fall of Mosul and impending offensive
8,000
against Raqqa, which is at the heart of the Caliphate. Current estimates
are that between 25,000 and 30,000 fighters, from 100 different 6,000
countries, have arrived in Syria and Iraq since 2011. Those who have
4,000
not perished in the conflict could plan attacks on home soil when they
return to their countries. 2,000

Some will have received Complex terrorist 0

operational training in
plots cannot be ruled 00

01

02

03

04

05

06

07

08

09

10

11

12

13

14

15
explosives assembly and

20

20
20

20
20
20
20

20
20
20

20

20

20

20

20

20
suicide attacks. out, as recent attacks YEAR
(source: START GTD, IEP calculations)
Some commentators posit in Paris and Brussels
that the nature of the current demonstrate.
threat environment - with
an increased volume of attacks in OECD countries - may be part of
an overall strategy to keep these countries under a constant state of
heightened security. The intention may be to strain law enforcement
resources to deflect attention from more complex plots.

Authorities across Western Europe concede that presently there is a

high likelihood of further attacks occurring and that more collaboration
is needed through bodies such as Interpol and Europol. In May 2016,
FBI director James Comey warned that Europe’s lack of coordination on
counter-terrorism was leaving it open to attack.

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CASE STUDY

After ISIS
by Andrew Glazzard, director, National Security and Resilience,
Royal United Services Institute (RUSI)

ISIS is staring at defeat and we can look forward to a time

when it has largely been eradicated. Or can we?

At the time of writing the Iraqi army was entering Iraq’s second change under the Trump administration), al- Assad’s hostility to
city of Mosul, site of Abu Bakr al-Baghdadi’s declaration of a new Western intervention, and Russia’s dominant military role in parts
Islamic Caliphate in 2014. Attention is therefore now turning to what of Syria. As long as the Euphrates valley remains available to ISIS,
happens after ISIS. There is widespread agreement that the fall of it will continue to claim to operate a state, and seek to maintain a
ISIS, in Iraq at least, is only a matter of time. Its territorial control has fiction that this is the renewed Caliphate.
already shrunk significantly from its highpoint in early 2015 and one
estimate claims it has lost 25% of territory over that time. In vacating northern Iraq, ISIS will inevitably leave a power
vacuum. What fills this vacuum will be crucial to Iraq’s long-term
The situation is fundamentally different in Syria, but even there ISIS security and well-being, and there is no doubt that a great deal
is under pressure from Turkish forces to the north, opposition fighters of political and diplomatic capital is being expended by a wide
to the west, and the Syrian-Russian coalition to the south-west range of actors inside and outside Iraq to ensure that what comes
and overhead. ISIS’s overseas territories – what it calls walayats next meets the country’s needs. Everyone – except ISIS – will want
(provinces) – are also under pressure, especially in Libya, where stability, but on their own terms.
it occupies the town of Sirte but not much else, and even that is
besieged by US-backed government militias. Its alliances with A lack of cohesion between the Shia majority, the Sunni Arabs who
groups such as Boko Haram in Nigeria do not appear to have make up the most substantial minority, and the (mostly Sunni) Kurds
amounted to much. continues to be Iraq’s most fundamental challenge. Each of those
groups fear domination by the others, and each operates armed
However, in spite of this progress there are good reasons to see militias, or has sought the protection of external forces, or both.
the coming period as being one of change and uncertainty rather Those external forces, meanwhile, are fighting several proxy wars
than renewed safety and security. To understand how ISIS might in Iraq as well as Syria. The outlook is therefore unpredictable, but
respond, it is helpful first of all to recognise its multiform nature. most scenarios are bleak.

Since its emergence in 2013, experts have argued over whether it is There are good reasons for thinking that Iraq will remain seriously
a terrorist group, or guerrilla movement, or a proto-state. In reality, unstable post-ISIS. ISIS’ predecessor organisations, al-Qaeda
it is all three, and something else besides – a global movement. in Iraq (AQI) and Islamic State of Iraq (ISI), thrived from 2003 to
ISIS will respond to military defeat in different ways according to its 2006/2007, and ISIS came back from apparent defeat in 2010
different manifestations. stronger than ever. Many of the political conditions that enabled
AQI/ISI largely remain.
The heartland
These include disastrously poor governance from Baghdad,
ISIS’s heartland is its territory in the Tigris and Euphrates valleys,
sectarian polarisation, a weak army and police force at odds
straddling the Iraq-Syria border, with its twin capitals of Mosul and
with some very strong militias and paramilitaries. Interference by
Raqqa in northern Syria. From 2014 to late 2016, anyone living
neighbouring countries, especially Iran, is another factor. Indeed,
in this region would have experienced ISIS rule, which had nearly
some of these conditions are worse today, as a result of intervention
all the characteristics of statehood. ISIS ruled through force and
from overseas and Baghdad’s over-reliance on militias, some of
intimidation, but also provided services, collected taxes (its main
which it cannot control.
source of revenue), exported raw materials (including to the Syrian
regime), hired and fired employees, and administered the law. At the heart of the post-ISIS problem in Iraq will be the perceptions
of the Sunni Arabs – largely disenfranchised, fearful of Shia
Losing this territory will end this experiment in governance. It will
domination, and many with little to lose. In the absence of a political
be more difficult to remove ISIS from northern Syria where the
settlement that binds in Iraq’s largest minority, an ISIS successor is a
international coalition has restricted room for manoeuvre given
real possibility.
the US’s refusal to cooperate with the regime (although this could

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The periphery Global ISIS

ISIS’s guerrilla activities are evident just outside its heartland. Inspiration is what has made ISIS one of the most feared but also
Its attack on Kirkuk in October 2016, just as the Iraqi army was influential violent groups in modern history. ISIS’s projection of itself
making rapid progress towards Mosul, illustrates its potency as a as a global movement has drawn recruits from almost every corner
guerrilla force. of the globe, inspiring lone-actor terrorism in several cities, and
alarming governments with the attractiveness of its propaganda.
What is more, ISIS has available to it an extremely useful asset to The anthropologist Scott Atran has characterised ISIS as a global,
any insurgent force: a border. ISIS and its predecessor organisations counter-cultural movement, appealing not just to the disaffected and
have long experience of utilising the Syria-Iraq border to their marginalised but to a broader constituency with its self-image of
advantage. It goes back to the early days of the insurgency when purity, authenticity and power.
al-Assad’s government cynically supported Sunni Islamist forces as
they harried coalition forces in Iraq from the borderlands. The difficulty with combating a movement that draws its strength
from being anti-authority is that the more the authorities seek to
ISIS will retain its Syrian base for some time to come and use this attack it, whether militarily or through argument or propaganda, the
to attack Iraq. Even when ISIS is removed from Raqqa, whether stronger it gets. For this reason, attempts to de-legitimise ISIS may
by coalition or Syrian regime/Russian forces, it will become a have a polarising effect – they will strengthen the convictions of
destructive insurgent force in many parts of Syria. The war-torn state those who find ISIS abhorrent, while amplifying its appeal for those
will simply not be strong enough to police itself internally for many minded to be sympathetic.
years to come.
Moreover, some communication on ISIS in the West may actually
The ‘Abode of War’ be counter-productive, as it takes aim at the wrong targets. For
While terrorists do not always need safe havens to be effective, a instance, the ambition for a Caliphate, according to opinion
space in Syria for planning, training and financing terrorism will polls, remains a worthy ideal for a high percentage of the world’s
remain one of ISIS’s most treasured assets. Raqqa, its Syrian capital, Muslims.
appears to be its command-centre for terrorist operations in the
It is against ISIS the global brand that events in Iraq may have the
West and it seems likely that ISIS will seek to increase the tempo of
greatest, positive effect. Like previous insurgencies from the Mahdist
its attacks.
revolt in the Sudan in the 1880s to Hezbollah’s wars, a violent
ISIS is not the first group to have compensated for losing territory challenge to the established order has its greatest appeal when
by increasing its terrorism. But whereas groups such as Al-Shabaab the insurgent is winning. ISIS made much of its astonishing victories
can only operate regionally, ISIS (like al-Qaeda) conceives of all against the Iraqi army and its conquest of large parts of Syria in
of the West and its allies as the ‘Abode of War’ – the territories in 2014 and 2015.
which attacks can be justified legally.

In addition to its command centre, ISIS has another formidable

A space in Syria for planning,
asset: its intelligence network. In part the legacy of the ex-Baathists training and financing terrorism
in its current and former hierarchy, some of whom worked for
Saddam Hussein’s intelligence services, ISIS has shown itself to be
will remain one of ISIS’s most
a master in techniques of infiltration, surveillance, and maintaining treasured assets
covert networks. These networks are believed to radiate out from
Syria, through Turkey and into Europe. The reality of defeat has already caused a change in tone for ISIS’s
propagandists, from confident predictions of apocalyptic victory
With its cadre of foreign terrorist fighters, including thousands
to pleas for patience and predictions of surprising raids against the
from Western Europe, some of whom have returned home or will
arrogant Coalition countries. Like other counter-cultural movements
be making plans to do so, ISIS remains well-placed to continue to
before it, the ISIS idea contains the seeds of its own destruction.
strike, and to inspire others to strike. Turkey and Saudi Arabia were
Perhaps the greatest weapon we can use against it is patience.
singled out for attack in Abu Bakr al-Baghdadi’s defiant recorded
speech to his supporters as the Iraqi army entered Mosul. The The difficulty for the Coalition, though, is that patience will not
former will probably be most exposed, as ISIS’s well-established be enough in the heartland and its periphery. So countering ISIS
facilitation networks there can be put to more violent purposes. means doing different things in different places against different
manifestations. Above all, it means addressing the governance
North African countries such as Tunisia, which have generated
failures which created ISIS in the first place.
so many of ISIS’ foreign fighters, will also be at high threat. And
Western European capitals will need to remain on high alert for the
foreseeable future, as well as western interests (hotels, embassies,
tourist attractions) in many countries around the world.

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Part Two: From the physical to the virtual.

Protecting your people and property

Responding to the threat

Those who protect us from security threats such as terrorism can take a great deal of credit for
successfully, and often unobtrusively, reducing our vulnerability to attack, as well as disrupting
attacks. According to the National Security Agency (NSA) over 50 potential terrorist attacks on
the US have been thwarted due to surveillance.

From sophisticated surveillance algorithms through to highly-engineered security barriers

disguised as public benches, the architects and implementers of protective security have
undoubtedly made our lives safer. London is said to be the second most watched city in the world,
with 420,000 CCTV cameras after Beijing, which has 470,000, according to the latest available
figures from Vintech in 2011. Chicago, Houston and New York are said to be the US cities with
the highest number of surveillance cameras. Intelligence services are increasingly making use
of high-tech tools, including facial recognition and voiceprint, to monitor suspects and intercept
communications.

However, even the most intuitive protective security measures can be overcome. Malicious actors
are often highly-innovative and spend a great deal of time doing research and development of
their own, identifying vulnerabilities and developing new ways of defeating counter-measures. In
protective security and counterterrorism, as in many other fields, there is a knowledge curve, and
malicious actors strive to be ahead of it.

The domestic threat

While the chance of getting caught up in a terrorist attack remains extremely remote, businesses
need to consider the safety of their employees as they go about their day-to-day business. They
also need to consider their response if indirectly affected, for instance if transportation systems or
city centres are shut down in the aftermath of an event.

It is clear that many business leaders are already alert to the threat. According to research carried
out by AIG and Ipsos MORI in the UK in 2016, forty percent of business leaders are fairly or
very concerned about the vulnerability of their people in the UK to terrorism. Thirty-seven percent
were concerned about terrorism impacting their business premises while a significant 55% were
concerned about the impact of terrorist activities impacting computer networks.iii

Situational awareness training for corporate security and other personnel can help staff to
recognise potential risks and vulnerabilities with the aim of creating a more alert workforce.
Everyone in an organisation should be part of the overall security awareness programme, not just
security professionals. Among other things, staff need to be able to identify and report suspicious
behaviour, e.g. individuals wearing unseasonable clothing (which could conceal weapons) or
who appear to be conducting reconnaissance.
Situational awareness
Situational awareness is “being aware of what is
occurring in your immediate area and recognising
training can help create
a potential threat at an early enough stage to a more alert workforce.
allow counter measures to be taken to avoid it”iv.
While a basic building block for law enforcement, military and intelligence professionals, the
general public is typically not as attuned to detecting abnormal behaviour or unusual activity.
In London, the UK government and British Transport Police launched its “See it. Say it. Sorted”
campaign in November 2016 in an effort to encourage commuters to be their “eyes and ears”.

iii 
The research involved face to face interviews with 114 C-suite and executive board level respondents from top 500 companies by turnover and top 100 by capital in the UK between
September and December 2016.
iv 
GP McGovern: http://www.terrorismanalysts.com/pt/index.php/pot/article/view/mcgovern-situational-awareness-in-terrorism/278

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However, while generally accepted in a country where there is a high

level of gun violence and 70% of active shooter attacks take place in
People are an organisation’s a businessv, elsewhere cultural acceptance is significantly lower. HR
greatest asset but also its greatest professionals are keen to strike a balance between adequate workplace
safety training and not wanting to scare their employees.
source of potential vulnerability
One way to broach such a challenge is to incorporate some elements
of active shooter training as part of fire response training exercises and
Locational awareness is also important. Following 9/11 there was a drills. Companies should challenge existing protocols to make sure they
strong focus on the risk surrounding iconic buildings. Many larger firms are fit for purpose, or adopt new ones. A fire alarm could tell staff to
chose to locate staff in several different offices and avoided major evacuate, but a different alarm might mean the building is under attack
skyscrapers and other landmarks. However, the MO of recent attacks and staff need to hide, for instance.
suggests that companies must now consider other situational risk factors,
such as proximity to shopping centres, transport hubs, concert venues People are an organisation’s greatest asset but also its greatest source of
and tourist attractions. potential vulnerability. Governments have depended on security vetting
for many years and systems have become increasingly sophisticated.
In the aftermath of the Brussels airport attack, one suggestion was made While no system is fool-proof, behavioural research can help security
to move check-in queues to the outside of the building. It is understood professionals identify and, just as importantly, manage personnel
this suggestion was quickly shot down by risk consultants, who risks. Personnel security is not just vetting but about a wide range of
explained that such a move would simply shift the main target (civilians) behaviours – such as workplace culture and morale, or individuals’
to a more vulnerable location. propensity for compliance.
AIG recently advised a publishing house situated close to one of One vulnerability that should be considered is the vulnerable or
London’s major train stations on how they should react if a marauding malicious employee who has access to systems which could cause
attack in the station were to occur and spill over into the surrounding significant damage in the wrong hands. One way of monitoring
area. Important considerations include how quickly the building could individuals with access to key infrastructure is via a buddy system,
lock lobby doors and close-off lift and stairwell access to floors above. whereby a colleague checks and approves decisions and actions.
An organisation and its security personnel need to be prepared to Many experts believe cyber terrorism is the next battleground in the
go into lockdown during the critical period just after a major event fight against terror, with attackers seeking to inflict physical damage,
and before emergency services arrive (known as the “dead zone”). bodily injury and economic harm by hacking into systems. DDoS attacks
In addition to first-aid training, frontline personnel need to be able to that brought down websites in the US, Europe and Liberia in 2016 have
triage - to prioritise, treat and remove casualties in order to save as demonstrated the vulnerability inherent in a hyper-connected world.
many lives as possible. Former CIA chief Leon Panetta famously warned that the “next Pearl
Harbor could be a cyber attack that cripples” America’s electrical grid,
In the case of a marauding attack, the response is to detect, delay, deny
its security and financial systems.
(access) and defend. External security guides and CCTV are essential
tools in protecting the perimeter, while internal security guards should One of the basic principles of good security is that it should be
be considered a second line of defence. Businesses should also be more integrated. In other words, physical, information, cyber and personnel
alert during certain times of day when their employees are in transit and security should be addressed holistically. Ensuring that your building
most vulnerable to attack (e.g. morning and afternoon rush hour and can withstand a vehicle-borne improvised explosive device (IED) is
during lunch). not much use if your personnel policies are so lax that anyone with a
smile can gain access to your site. Likewise, investing in the most robust
In certain sectors, “active shooter” training may be appropriate. With
software for intruder detection is money down the drain if you allow
the mantra of “Run, Hide, Fight” staff are taught how to find exits,
staff, contractors, or visitors uncontrolled access to your servers.
barricade doors with office furniture and improvise weaponry with
realistic drills and rehearsals. Post the 1999 Columbine High School
shootings in Colorado, such training has become increasingly common
in the US for schools, colleges and businesses.

v FBI

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Companies must
consider situational
…and the threat overseas
risk factors, such as
proximity to shopping Companies have an increasing duty of care towards their staff given the changing face of
centres, transport hubs global terrorism. Over half of respondents interviewed in the Ipsos MORI AIG research
registered concern about the safety of their personnel when travelling overseas, with nearly
and tourist attractions. 40% implementing changes to better protect their staff when abroad.

It is essential to know where employees are, particularly when travelling abroad, and ensuring
there are quick and easy methods for them to make contact in the event something goes wrong.
Companies may want to consider the following risk mitigation strategies are in place to keep staff
safe as they travel on business and work abroadvi:

Company travel policy

Clear and simple policies and procedures should enable a company to know where their
employees are going, what they are doing and how they can be best prepared and protected
during such activities. A company travel policy should ensure the highest possible degree of
safety and security for employees when travelling overseas and that all business related travel to
risk-rated countries is subject to a formal risk assessment.

Considerations prior to travel

A risk assessment process informs an organisation as to whether more robust training or support
is required for business travellers prior to deployment. An up-to-date country travel risk tool can
assist with this as it allows a business to risk assess trips in line with its risk appetite and also to
monitor situations as they unfold, keeping the business informed in the event that decisions need to
be made about its staff in particular locations.

Incident response
It is vital that the company travel policy outlines what employees should do in the event of an
incident, for example, who to call and how to behave. Employee responses to incidents need
to be in line with the company’s corporate crisis management plan which is, in turn, informed to
some extent by the insurance policies that are in place.

vi Willis Towers Watson: http://www.willis.co.uk/documents/Services/Willis_Risk_Insight_Travel_and_Security_Employers_Duty_of_Care_LR.pdf

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CASE STUDY

Expect the best, plan for the worst

by Scott Walker, Manager, Crisis Response, NYA International

During a terrorist attack businesses can really only be reactive: there Companies should plan in advance which departments and
will be little opportunity to influence the outcome of the incident individuals own this aspect of the crisis management infrastructure
beyond communicating to staff and customers to either ‘lockdown’ along with who writes and sends the messages. The technology is
in a safe location or evacuate, depending on what is deemed the redundant if employees aren’t informed of it, trained in its use or
most appropriate way to mitigate loss of life. Due to the chaotic and supportive of it.
fast moving nature of such incidents, crisis management teams and
other senior security functions will struggle to influence or control Established standards – such as ISO 31000:2009 Risk
events as they unfold. Management and BS 11200:2014 Crisis Management – and
physical security management techniques remain relevant despite
In this type of situation, the traditional crisis management scenario the evolution of the global terrorist threat. Employed correctly, these
whereby the decision-making authority and crisis management team approaches offer a means for businesses to order their thoughts,
make decisions and pass to operational or local teams becomes develop appropriate strategies, deploy appropriate resources and
inverted. The former functions will have much reduced influence, prepare effective plans.
if any at all, in the initial stages of a marauding terrorist firearms
incident. Local, often public facing staff such as receptionists, Post-incident response
security guards, fire marshalls or floor wardens will be those Considering the short timescales and the primacy of state actors in a
leading the response. terrorist incident response, the challenges for businesses are focused
as much on post-incident response and recovery, as well as business
Statoil’s response to the In Amenas gas plant attack, which took
continuity. It is therefore just as important to plan for the aftermath.
place in Algeria in 2013, provides one example. The independent
investigation report into the attack – in which five employees With multiple actors and considerations, post-incident response and
died – commended Statoil’s contribution to the collective recovery is hugely challenging. Businesses caught up in a terrorist
response, specifically concerning the support from leadership to incident will typically have to navigate a chaotic scene involving
emergency response teams and the clarity and honesty around law enforcement agencies, military, government and diplomatic
communications. agencies, and international media. Family and employee liaison
and – potentially – next-of-kin notification is of primary importance.
Such a response demonstrates duty of care by the organisation if
and when the worst happens. Next on the list of chief concerns are crisis communications
to all stakeholders, including employees, families, customers,
Planning and training shareholders, the public, the media and law enforcement. Of their
The nature and scale of the recent Paris attacks exposed a lack of own experience, the Statoil report noted, “a systematic approach
sufficient or suitable planning. Many organisations did not know of and resources made available to those involved in [an] incident and
their staff members’ whereabouts and struggled to contact them en their next-of-kin should be embedded in the company’s plans for the
masse on a Friday night, with overloaded communications networks future.”
and widespread panic.

The incident has led to revitalised interest in crisis communications

across Europe, especially mass notification systems, whereby an
SMS, recorded message or email is issued to individuals. These
can come in the ‘push and pull’ variety. In the former, a message is
sent – i.e. pushed – to a recipient. In the latter, a mechanism such
as a pre-recorded voicemail facility is established for individuals
to contact. Both push and pull messaging can provide vital
communication to employees and stakeholders during an incident
and help ensure duty of care.

AIG White Paper Page 11 of 14

 AIG Terrorism White Paper

Part three: Mind the gap: Broadening the

scope of terrorism insurance

Terrorism risk is one of the few manmade perils capable of producing Tourism revenues in Tunisia were down 35% year-on-year after the
a $50 billion-plus loss. For this reason, in many countries, cover for Sousse attack in which 39 holidaymakers were gunned down as they
nuclear, biological, chemical and radiological threats is only available sunbathed outside the Imperial Marhaba hotel. Tourism’s contribution to
via terrorism pools. However, the economic impact on an organisation GDP is twice as large in countries with no terrorist attacks compared to
arising from a terrorist incident may be much greater than the actual countries with attacks, according to IEP.
physical damage.
Currently, one of the biggest exposures for AIG clients is from a business
In 2015, the global economic impact of terrorism reached $89.6 interruption (BI) standpoint, something that needs to be considered
billion, decreasing by 15% year-on-year, but still the second most when insurance programmes are put in place. In the aftermath of the
costly year for terrorism since 2000. The economic impact of terrorism Sydney Siege of December 2014 for instance, parts of the CBD -
remains relatively small in comparison to other forms of violence, and is including a pedestrian mall - were shut down by police during what was
highest in countries where armed conflict is ongoing; however in 2015 normally a busy shopping period in the run-up to Christmas.
and 2016 costs relating to terrorist activities spiked sharply in OECD
countries, reflecting an increase in deadly attacks. This type of disruption highlights the need for broad, joined-up
coverage, including non-physical damage BI (such as business
There are secondary economic impacts relating to these attacks. In interruption that is triggered by denial of access). It is however important
France, for instance, the GDP contribution from tourism fell by $1.7 to note that property policies do not cover the “fear factor”, such as the
billion between 2014 and 2015 in the aftermath of the 7 January 2015 dramatic loss of tourism revenue in countries such as Tunisia and Turkey
Charlie Hebdo shooting and November 2015 Paris attacks. Meanwhile following attacks and political unrest.
in Italy, which had no deaths from terrorism during that period, the
tourism sector grew by $4.9 billion.

Fig 4 Economic impact of terrorism, US$ billions, 2000-2015

Based on IEP’s methodology, the global economic costs of terrorism peaked in 2014 and remained high in 2015.

120

106
CONSTANT 2015 US$, BILLIONS

100

90

80
62 73

60
SEPTEMBER 11
ATTACKS 49

40 37
30 31
29 30
24
20 18 17
13
8 10 8

0
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

(Source: START GTD, IEP)

YEAR

AIG White Paper Page 12 of 14

 AIG Terrorism White Paper

In certain regions, terrorist acts are more likely to be financially Fig 5 Breakdown of the economic impact of terrorism, 2015
motivated through activities such as kidnap and ransom and hostage
Fatalities account for 73 per cent of the economic impact of terrorism.
taking. Faced with such exposures, organisations need to ensure they
have an extra level of security, training and insurance. Specialist kidnap INJURIES 1%
and ransom insurers and crisis management consultants work with
PROPERTY
domestic and international authorities to provide clients with the right DESTRUCTION 2%
level of support to manage through often very difficult situations.

Given the changing nature of the threat, clients are encouraged to DEATHS GDP
74% LOSSES
look at their overall insurance needs and consider whether terrorism
23%
should be purchased as a standalone cover or embedded within a
broader property portfolio. One advantage in having both property
and terrorism with the same carrier is certainty of cover regardless of the
event and its definition.

The Bangkok riots in 2010 and turbulence in the Middle East since
2011 have demonstrated the potential for gaps in cover where terrorism (Source: IEP)
insurance was not in place. The definition of an event (often politically-
driven) led to confusion over whether physical damage and/or business Fig 6 Economic impact by type of attack, 2015
interruption arising from an incident should be picked up by property
strikes, riots and civil commotion (SRCC) coverage or terrorism, PROPORTION OF
CATEGORY
sometimes resulting in claims disputes. ECONOMIC IMPACT

Bombing/explosion 43.2%
There is currently a movement towards embedded cover, encompassing
property, terrorism, business interruption, kidnap for ransom and Armed assault 18.8%
political violence, which offers clients greater certainty of cover. When
Hostage taking 7.9%
discussing specific needs and concerns with insurer and broker partners,
insureds should question whether any gaps exist within their insurance Assassination 2.1%
programme, as certain extensions may be available to cater to a Facility/infrastructure attack 0.3%
particular problem (e.g. heavy reliance on one supplier or customer).
Hijacking 0.1%
Unarmed assault 0.1%
Other/unknown 27.4%
(Source: IEP)

Key questions for risk managers and insurance buyers:

What steps are you taking  o you understand the secondary
D  ave you and your insurer
H
to protect your property and impacts an act of terror could partners taken steps to
people given the changing have on your business? What identify and close any
nature of the terrorism threat? contingency plans are in place? gaps in cover?

AIG White Paper Page 13 of 14

www.aig.com

American International Group, Inc. (AIG) is a leading global insurance organization serving customers in more than 100 countries and jurisdictions. AIG companies serve commercial, institutional, and individual customers through
one of the most extensive worldwide property-casualty networks of any insurer. In addition, AIG companies are leading providers of life insurance and retirement services in the United States. AIG common stock is listed on the
New York Stock Exchange and the Tokyo Stock Exchange.
Additional information about AIG can be found at www.aig.com | YouTube: www.youtube.com/aig | Twitter: @AIGemea | LinkedIn: www.linkedin.com/company/aig
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products and services are written or provided by subsidiaries or affiliates of American International Group, Inc. Products or services may not be available in all countries, and coverage is subject to actual policy language. Non-
insurance products and services may be provided by independent third parties. Insurance products may be distributed through affiliated or unaffiliated entities. In Europe, the principal insurance provider is AIG Europe Limited.
AIG Europe Limited is registered in England: company number 1486260. Registered address: The AIG Building, 58 Fenchurch Street, London EC3M 4AB. AIG Europe Limited is authorised by the Prudential Regulation Authority
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