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Monday, 6 May, 2002, 10:45 GMT 11:45 UK
Warren Buffett warns on terror risk
Warren Buffett pictured in 1991
The billionaire predicts more terror strikes
Insurance companies offering terrorism cover will almost certainly face massive claims that could put them out of business, the billionaire investment guru Warren Buffett has warned.

Sooner or later, the US would suffer a terrorist attack that would dwarf the losses caused by 11 September, he predicted.

"Many insurance companies are exposed to ruin," he said.

"We're going to have something of a major nuclear event in this country," Mr Buffet said following the annual general meeting of his company Berkshire Hathaway.

Government role

The risks of chemical or biological attacks are also high, with Washington and New York the most likely targets in the US, he said.

"It will happen - whether it will happen in 10 years or 10 minutes, or 50 years... it's virtually a certainty."

Insurance companies linked to Mr Buffett's own Berkshire Hathaway empire have learnt their lesson from 11 September.

General Re, which was hit by a $2.4bn underwriting loss, limits its liability for nuclear, biological or chemical attacks when it offers terrorism cover.

Only the US federal government could ultimately insure against damage from major terrorist attacks, Mr Buffet said.

Insurance is Mr Buffett's main business.

See also:

01 Mar 02 | Business
The rich get poorer
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21 Sep 01 | Business
Insurance bill mounts further
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