Compensation scheme for british victims of overseas terrorism receives Royal Assent

A scheme to compensate British citizens injured by terrorist attacks outside the UK received Royal Assent last night. The Victims of Overseas Terrorism Compensation Scheme will apply to British victims injured in designated terrorist acts that occur outside the UK on or after 18 January 2010.  On a pro bono basis, Lovells has worked closely with interested parties, victims and their representatives, the insurance industry and legislators over the past three years to secure the introduction of the legislation. 

The scheme is forward looking so only covers British citizens who are injured in terrorist attacks abroad from 18 January 2010 onwards.  The announcement by the Justice Secretary, Jack Straw MP, on 18 January 2010 also recognised that there will be victims of overseas terrorist attacks in recent years who continue to face hardship as a result of the on-going consequences of a disability arising from the injuries they sustained.  It added that assistance would be provided to eligible victims of overseas terrorism attacks since January 2002.   

Details of the hardship fund have yet to be announced.  However, in a letter from the Justice Secretary seen by us it states that:  

1.1  The awards payable under the ex gratia arrangements would not be on a par with those that would be payable the prospective statutory scheme; 

1.2  There would be no awards to those who were bereaved in past attacks or to those who were injured and who are now recovered; and

1.3  For those who do have an on-going disability, one-off payments would be calculated by reference to a tariff based on the seriousness of the injury or injuries, but there would be no payments for loss of earnings or special expenses (this is likely to be the most significant element from victims already injured). 

The total number of British victims of terrorism abroad is far fewer than are dealt with under the current criminal injuries compensation scheme (CICA). Between 2002 and 2008, approximately 44 British holiday-makers were killed by terrorist attacks abroad and less than 50 seriously injured.  This number comprises the bombings in Bali (2002), Sharm el Sheikh (2005), Bali (2005), Turkey (2005), Dahab (2006), Turkey (2006) and Mumbai (2008).  Those injured in the attacks suffered a range of injuries from neurotrauma through to loss of limbs, burns, damaged hearing and loss of sight.   

Lovells and the law firm Field Fisher Waterhouse provided strategic and substantive advice to the many families affected by terrorism abroad.  In particular, the pair have assisted Trevor Lakin, who was bereaved following the terrorist bombing in Sharm el Sheikh, with his campaign to change the situation for those affected by terrorism.  Mr Lakin and other victims such as Will Pike who have campaigned tirelessly for a change in the law.  As things stand, the hardship fund for victims injured since 2002 will be of extremely limited benefit to them.   

Chris Hill, senior associate in Lovells’ insurance and reinsurance practice, said:      

“We are delighted that Royal Assent has been given to this Bill, allowing British victims of terror attacks overseas to become eligible for compensation.  This is a major step in ensuring that victims of terrorist attacks in foreign countries receive a sufficiently strong platform of support.  Before the Bill was announced, there was a discrepancy between the treatment of British victims of terrorism injured here and those injured outside the UK.  However, it seems that the support that will be given to victims injured in past incidents will be far less than that given under this forward looking scheme and no compensation will be given to those bereaved."

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From 1 May 2010, Lovells LLP and Hogan & Hartson LLP will combine to form Hogan Lovells. For more information about Lovells, visit www.lovells.com Lovells (the "firm") is an international legal practice comprising Lovells LLP and its affiliated businesses.  Lovells LLP is a limited liability partnership registered in England and Wales with registered number OC323639.  Registered office and principal place of business: Atlantic House, Holborn Viaduct, London EC1A 2FG.  

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