15 January 2015

Declaration of a terrorist incident: Government acts to ensure payment of insurance claims for Lindt Café incident

Following the tragic events at the Martin Place Lindt Café in December 2014, I have today declared the siege a “terrorist incident” for the purposes of the Terrorism Insurance Act.

Prior to making this decision, appropriate consultation was undertaken with the Attorney-General and a number of stakeholders, including the Insurance Council of Australia.

The Government has taken this action to ensure businesses that suffered damages from the incident will not be denied claims due to terrorism exclusions in their insurance policies.

The effect of this ministerial declaration is that insurers will be prevented from refusing claims from affected businesses on the basis that their policies exclude losses from acts of terrorism.

Advice from the Australian Reinsurance Pool Corporation (ARPC) indicates the three insurers that have registered claims to date have stated they will not apply terrorism exclusion clauses. I am pleased to see these companies acting so responsibly at this difficult time.

Individual insurers have different payment thresholds before they can claim from the ARPC, depending on their size. ARPC has reported the current estimate for the total insured is just over $600,000.

Losses from this incident are well short of the limit at which the Commonwealth may become liable for payments.

The Australian Government is doing everything it possibly can to keep Australia safe and disrupt terrorist planning and activity in Australia.

The review into the Martin Place siege currently being conducted by the Commonwealth and New South Wales governments will tell us what lessons can be learned from the events leading up to and surrounding the siege. 

At the same time, our law enforcement and security agencies continue their work to prevent and disrupt any individuals who may seek to do us harm.

Last year, we committed more than $630 million in additional funding to help our agencies monitor individuals of interest and disrupt terrorist attacks. 

We also introduced a broad range of new counter-terrorism laws that give our law enforcement and security agencies the tools they need to disrupt and combat terrorism, including the threat posed by returned foreign fighters.  

Our efforts will continue as we do all we can to prevent such a terrible incident from happening again.