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Oklahoma school districts eyeing terrorism insurance

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TULSA, Okla. (AP) _ Officials at McAlester Public Schools want to insure against any catastrophe, including terrorism. That's why the district is looking to purchase terrorism insurance.

A new federal law mandates that special terrorism insurance be offered to commercial insurance clients, including schools.

Under the law, insurance companies are required to notify all commercial policy holders by the end of February that coverage for terrorism is available.

Policy holders have 30 days from the first notification to reject, accept or modify the coverage. Only foreign terrorism is covered by the new law.

For McAlester school officials proximity to the McAlester Army Ammunition Plant, the government's key bomb-making facility, has prompted district officials to start shopping.

Business manager for the district in rural southeastern Oklahoma, Jim Northcutt said he's looking into the extended coverage.

``It never crossed my mind that insurance companies wouldn't cover that type of activity. It never crossed my mind that we would be worried about it, either,'' Northcutt said.

``I have to protect the property in any way I can. That's my biggest concern.''

Northcutt said he hasn't been quoted a price for the insurance, but thinks it probably will be worth it to the district.

Other districts are quite ready to pay for the coverage.

Tulsa Public Schools has rejected terrorism coverage. District Chief General Services Officer Jim Spear said the extra coverage, billed at nearly $14,000, was too expensive, and the district decided that the risk was not that great.

The district's relative isolation from potential targets of terrorism convinced school officials that the decision was a safe one, he said.

David Meuser, spokesman for the Oklahoma Insurance Department, said until the Sept. 11, 2001, attacks, terrorism was not specifically addressed in standard insurance policies.

``It wasn't excluded, but it wasn't addressed,'' said Meuser.

``When the attack did occur, it was presumed that there was coverage, until many companies then excluded it,'' he said.

New federal laws prohibit companies from repeating this.

As the new insurance coverage generates interest, insurance companies are hustling to set rates.

Tina A. Christy, underwriter manager for National American Insurance Company, which provides policies to about 75 percent of the state's school districts, said the company is still developing its rates and procedures but commercial policy holders, including the school districts.
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