Dear Friend,

It has been difficult for we UK residents to confront the fact that the people who carried out last week’s terrible bombings were born and bred here.

One newspaper even reproduced one of the bomber’s birth certificates on its front cover as if to say “we didn’t believe British people were capable of this — but here is the grisly, shocking proof”.

The media are full of stories of the three Yorkshire lads — one who was at college, one had worked in a school and the youngest, who was only 18 years old, was apparently “a bit of a dork”. Neighbours and families speak of these characters’ abject normality — they were “nice guys”.

What’s for sure is that they were “nice” enough not to be under any suspicion by the police or the secret services. When they donned their rucksacks and said their farewells at Kings Cross station, no alarm was raised — they were just a group of nice guys on a day trip to London , perhaps on their way to a cricket match or to visit a museum.

Of course, the reality was very different and serves as a reminder, if any be needed, of the extreme complexity of the “War against Terror” and the value of terrorism insurance in advanced liberal economies.

In the UK the State is the reinsurer of last resort and although it is an extra layer of bureaucracy, the Pool Re scheme gives UK businesses a certain amount of comfort that the Government will step in if the market fails.

What do you feel about the role of the State in terrorism insurance?