War Peril

What Does War Peril Mean?

War peril refers to risks that can lead to losses during a war, such as property damage from battles, theft of cargo by insurgents, or the kidnapping or injury of employees in a war zone. Most standard insurance policies do not cover war perils because insurers consider these risks too severe and costly to provide coverage.

Insuranceopedia Explains War Peril

There are specific war insurance policies designed to cover war perils. For example, a company can purchase a war insurance policy to protect against property damage and theft when doing business in a country at war.

However, some war perils are deemed too costly for the private market to cover. In such cases, the government steps in to provide insurance. For instance, after the 9/11 attacks, insurers ceased offering affordable liability coverage for commercial planes, prompting the Federal Aviation Administration to provide this insurance.