August 27, 2025
In a time of growing global unrest and uncertainty, the ripple effects are being felt across industries – including insurance. While property insurance is designed to protect against a wide range of risks, recent events in the UK have underscored how lesser-known policy exclusions can significantly impact claims outcomes. The following examples illustrate how complex and unusual the path of a claim can become when exclusions come into play.
1. A WWII Bomb and the War Exclusion Clause
In a striking example of how the past can unexpectedly shape the present, a case involving the University of Exeter brought renewed attention to the complexities of insurance exclusions. In 2021, a WWII-era bomb was discovered and safely detonated in a controlled explosion. While the immediate event was managed with care, the resulting property damage led to a legal dispute over coverage.
The court ultimately ruled that the damage was excluded under the policy’s War Exclusion clause – not because the detonation itself was an act of war, but because the original cause (the bomb being dropped during WWII) was deemed the proximate cause of the damage. This interpretation, while legally sound, may feel counterintuitive to those affected.
Key Takeaway:
Even when damage occurs decades after an initial event, if the root cause is tied to an excluded peril like war, coverage may be denied. This case also highlights how courts interpret ‘concurrent proximate causes’ – if one is excluded, the entire claim may be rejected. It’s a reminder of how important it is to understand the fine print, especially in legacy or unusual scenarios.
2. Politically Motivated Arson: When Exclusions May Apply
In today’s complex global climate, politically motivated acts of violence and sabotage are, unfortunately, becoming more common – and their impact can be devastating. One recent incident involved a targeted arson attack on a commercial warehouse, resulting in significant property damage and business disruption. While the motivations behind such acts may be rooted in international conflict or political ideology, the consequences are felt deeply by the businesses and communities affected.
Insurance Implication:
Most commercial property policies exclude damage caused by terrorism, sabotage, or politically motivated acts unless specific terrorism coverage is in place. In cases like this, insurers may interpret the event as falling under one of these exclusions, which can complicate or even prevent a successful claim.
Key Takeaway:
If your business operates in a high-profile or politically sensitive space, it’s worth reviewing your policy and considering terrorism insurance as an added layer of protection. Being proactive can make all the difference in how quickly and fully you recover from an unexpected event.
3. Ideologically Charged Vandalism: Where Coverage Can Get Complicated
In recent years, we’ve seen a rise in activist-related demonstrations that result in property damage – from paint-splattered buildings to defaced signage and disrupted operations. While these acts may appear to be straightforward vandalism, their underlying motivations can introduce complexity when it comes to insurance coverage.
Insurance Implication:
Most standard commercial property policies cover malicious damage or vandalism. However, if an incident is deemed to be politically motivated – or if the group responsible is later designated as a terrorist organisation – insurers may invoke exclusions related to terrorism or sabotage. This can leave businesses unexpectedly exposed if their policies don’t explicitly include coverage for such risks.
Key Takeaway:
Again, if your organisation operates in a high-profile or politically sensitive space, it’s important to review your policy language carefully. Understanding how your coverage applies in these nuanced situations can help you prepare for the unexpected – and ensure you’re protected when it matters most.
Final Thoughts
These cases show that exclusion clauses are not just legal fine print, they can determine whether you receive a payout or not. As threats evolve, from war remnants to cyber sabotage and political or terrorist activism, it’s crucial to:
- Understand your exclusions
- Assess your risk exposure
- Consider specialist cover where needed
Tags: Property United Kingdom
