One of the UK's biggest motor insurers has told its customers that it will not cover damage to cars caused by any form of terrorist activity.

The warning by Direct Line follows a similar warning by Norwich Union earlier in January that it would not cover home insurance customers for chemical, biological or "dirty" nuclear attacks.

It is thought to be one of the first insurers to issue a specific terrorist warning about car cover.

Direct Line - the pioneer of motor insurance telephone sales in the UK - is sending out warnings with its policy renewal documents.

The move follows increased fears that the UK could be the target for terror attacks.

Renewal warning

The document entitled "Important changes to your motor policy" tells policyholders that "Any claims or incidents arising from any Terrorist act are not covered under this policy except as to meet our requirements under the Road Traffic Act 1988."

"Acts of war" or "terrorism" are traditionally excluded from insurance policies, but the insurer is believed to be one of the first to warn customers.

The position of different car insurers on the issue of terror cover varies - and not all policy documents mention the exclusion.

Direct Line's exclusion includes damage caused by "firearms, explosives, biological, chemical nuclear or other means".

Direct Line were unavailable for comment.