Following several quiet years, the U.S. saw an increased number of terrorist plots in 2009, five of which were publicly documented, bringing the total known number of threats since the September 11, 2001 attacks to 33. While most were intercepted through the diligence of U.S. intelligence services, Risk Management Solutions (RMS) finds that the likelihood of the execution of a full-scale terrorist plot is directly correlated with the number of operatives involved in the planning.
“The execution and frequency of successful large-scale attacks are crucially dependent on terrorist social networks,” commented Dr. Gordon Woo, catastrophist, RMS. “Too many terrorists can spoil the plot.”
According to the RMS U.S. Terrorism Model, the probability of a planned attack being foiled is twice as high for a cell size of three compared with a lone terrorist. If the cell has 10 operatives, the probability is as high as 95 percent.
During the summer of 2007, two extremists attempted to detonate a car bomb outside a nightclub in London. With just two operatives involved, the plot was not interdicted. While the small number of those involved decreased the chance of the plot being interdicted, the bomb failed to detonate.
RMS has long argued that terrorism risk is cyclical—as terrorist activity increases, authorities respond with security crackdowns until an equilibrium is reached. The recent flurry of activity, such as the attempted Times Square car bombing in New York City in May 2010, indicates that individuals and cliques inspired by Al Qaeda’s ideology remain a powerful threat, and are capable of causing major losses to insurers and Western interests in general.
“The price of terrorism insurance reflects the infrequency of major successful attacks, primarily because of the authorities’ ability to interdict operations of larger terrorist cells,” added Dr. Woo. “The take-up rate for terrorism insurance is higher today than it was in the first few years after September 11th.”