Claims for business interruption following the terrorist attacks on the US are emerging as potentially some of the biggest and most difficult to quantify liabilities for the insurance industry.

Qualifications for pay-outs are so stringent that claims are rarely made, but this week's disaster was so extensive that industry's exposure will be significant.

In the area of approximately five square miles in lower Manhattan, which still remains closed or partially closed, there are thousands of businesses and millions of square feet of office space.

To trigger liability for business interruption in the US, companies have typically to sustain physical loss or damage to their buildings. They can also claim if the building becomes unusable because of area closures.

The interruption has continued for more than 72 hours, which also means that for most of the huge commercial area that has been out of action the usual hurdle of a time deduction - or excess - has been cleared.

"The business interruption loss will be in the $2bn-$3bn range," say analysts at Fox-Pitt Kelton, an investment adviser. Although it will be widely dispersed, the large commercial property insurers such as AIG and Chubb will be the most affected.

Only property loss liability will be larger, Fox-Pitt Kelton says. "The terrorist attack on the [World Trade Center] in 1993 was a $510m loss. . . it was primarily a business interruption loss, as there was little structural damage."

That earlier loss gives an indication of the scale of the business interruption pay-outs that can be expected this time.

There are likely, however, to be some limiting factors. The Insurance Information Institute says that business interruption coverage is normally only bought by about 25 per cent of businesses.

Small businesses such as shops in the area may not have bought the insurance. However, among financial savvy and large organisations near Wall Street, there could be a higher percentage with cover.

But not all will be covered. While relocation expenses could be part of the policies, banks in particular are required to swallow some of the expense from catastrophes themselves.

The rest of the pay-outs could be constrained too. Typically, net income lost - income after expenses - would be recoverable. However, financial institutions such as bond traders, brokers and other asset managers will find it hard to prove that income lost was because of closed buildings rather than closed markets.

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