AUSTRALIAN BANKERS’ ASSOCIATION WELCOMES FEDERAL GOVERNMENT’S REPLACEMENT TERRORISM INSURANCE SCHEME Sydney, October 25, 2002: The Australian Bankers’ Association (ABA) has welcomed the Federal Government’s replacement terrorism insurance scheme as it will increase public confidence and provide commercial certainty for Australia.  David Bell, Chief Executive of the ABA, said: “ I am pleased the Federal Government has acted because there was a clear market failure after the September 11 terrorist attack when reinsurers progressively withdrew cover.” “The Federal Government’s scheme for replacement terrorism insurance will prevent the adverse economic impacts that could have flowed from the previous uncertainty.” “The scheme will provide certainty for loan security and servicing, project finance of large infrastructure and property projects, and the funds management sectors which manage property portfolios.” “I am reassured that the scheme will compulsorily require insurance companies to provide cover for all terrorism risk, on all policies, in all classes of insurance included under the scheme.” “In addition, I am pleased to see that it will cover associated business interruption and public liability, as well as biological and chemical risks.” “This important step by the Federal Government recognises that there is virtually no terrorism-related insurance cover for commercial property and business interruption. And where the cover is available, it is at a price that far exceeds the perceived cost of the risk, with large excesses and relatively low maximum coverage compared to the cover available pre Sept 11.”  For further information contact: Heather Wellard ABA PR Phone: 02 8298 0411 Mobile: 0409 830 439 ENDS