A major insurance company has inserted a clause into its car and contents policies that means it does not have to pay out claims in the event of a terrorist attack.
AMI Insurance Photo: AMI
AMI Insurance, which was bought by the Australian conglomerate IAG in 2012, added the clause to the policies late last year.
It said its other companies already had the clause, and the move was to ensure consistency across the organisation.
The clause states any damage caused by terrorist attacks is not covered.
Insurance Council chief executive Tim Grafton said while the clause might seem unusual, there was good reason for it.
"Metropolitan centres where there are houses, motor vehicles, contents and the like, you can imagine this plane might be hijacked and crashed into a suburb and that would bring about a considerable loss - the insurers don't provide the cover for that loss."
State, Tower, AA and Youi also do not pay out for acts of terror.
