Simon Property Group announced today that it has insured its entire portfolio against terrorism by acquiring two terrorism policies, each with $100 million aggregate limits.
The Indianapolis-based REIT said the first policy will insure the Mall of America in Bloomington, Minn., against damage from terrorist attacks. The second policy will insure the remainder of Simon’s portfolio, the company said.
The nation’s largest owner of regional malls, Simon bought the policies from Lexington Insurance Co., a subsidiary of American International Group. The deal, which provides coverage throughout 2002, settles a legal dispute that began last year between Simon and GMAC Commercial Mortgage Corp. over the cost of a terrorism insurance policy, which Simon had said was inflated.
Simon noted that the company’s new premium is much less than that which GMAC originally proposed for the owners of Mall of America, which include Simon Property Group, Teachers Insurance and Annuity Association and Triple Five Corp.
"It was extremely important that we secure coverage that would provide protection for our properties but not impose an unreasonable burden on our malls' tenants, many of whom are small business owners," Simon CEO David Simon said in a statement.
In early trading today on The New York Stock Exchange, Simon's stock price rose 10 cents, or 30%, to $33.07.
-- Staff and wire reports