Sabotage

Concept

Sabotage refers to the intentional damage, destruction, or impairment of property, facilities, or business operations by third parties pursuing political, ideological, economic, or other objectives, without the act necessarily constituting an act of war, civil war, or civil commotion in the narrower sense.

Cover and Typical Exclusions

In the model conditions of many property insurance policies, sabotage is either expressly named as a covered peril or subsumed under the broader category of civil commotion or malicious damage by third parties; frequently, however, sabotage is also formulated as a standalone exclusion, particularly where it is connected with terrorism, war, or war-like conditions, since these risks are treated separately due to their potentially catastrophic and difficult-to-calculate magnitude.

Relevance for Business Interruption and Cyber Risk

Beyond direct property damage, sabotage can also give rise to significant business interruption losses, for example where critical operating facilities or IT systems are deliberately damaged or manipulated; with the increasing digitalization of production processes, cover against sabotage in the form of targeted cyberattacks on control systems is gaining importance and is increasingly addressed under specialized cyber and property insurance policies.