The European Commission had earlier warned the sector it had violated EU rules on restrictive business practices with its coordinated response to the Sept. 11, 2001, attacks on the United States.
The industry has now responded to an EU request that insurers keep coordinated actions to a minimum and provide more customer representation and services.
''Undertakings provide that if an unforeseeable crisis resulting from war or terrorism arises, insurers will limit any coordinated action to that which is indispensable to ensure that capacity continues to be available and customers can continue to buy insurance,'' the EU head office said in a statement.
The Commission said it would continue to monitor the market closely.
Immediately following the Sept. 11 terrorist attacks, private insurers refused to cover aviation war and terrorism insurance and EU governments had to foot the bill. Once insurers were drawn back to the market, cooperation limited market competition.
Airlines will now have a greater say on terms of insurance policies as well as in the wording of clauses. Aviation insurers have agreed to consult their clients on clauses and are even offering to let airlines write some of the clauses.