Martin Place siege declared an act of terror for insurance purposes

Treasurer Joe Hockey has declared the siege in Sydney's Martin Place a terrorist incident.

"I have today declared the siege a terrorist incident for the purposes of the Terrorism Insurance Act," Mr Hockey says in a statement on Thursday.

The government has taken this action to ensure businesses that suffered damages from the incident will not be denied claims due to terrorism exclusions in their insurance policies, he said.

Mr Hockey said the decision had been made after consultation with the attorney-general and stakeholders, including the Insurance Council of Australia.

"The effect of this ministerial declaration is that insurers will be prevented from refusing claims from affected businesses on the basis that their policies exclude losses from acts of terrorism."

He said the government was doing everything it could to keep Australia safe and disrupt terrorist planning and activity.

The review into the Lindt cafe siege being conducted by the commonwealth and NSW governments would uncover what lessons could be learned from the events leading up to and surrounding the siege, he said.