Traditional liability rule in tort law, according to which compensation is owed by the person who caused damage, applied in cases of damage caused by a terrorist act almost always leaves the loss with the victim. Persons whose liability is strict (keepers of dangerous things, operators of dangerous activities, carriers etc.) can be liable for that damage in the case when terrorist act, according to the circumstances, can not be classified as an Act of God, unavoidable event, or any other recognized reason for exclusion of liability. The state has general obligation to maintain safety of its citizens, which includes prevention of terrorist attacks. ln comparative law, liability of the state does not follow from the mere occurrence of terrorist act. Evaluation concerning the possible existence of a state liability must be carried out considering the circumstances of each and every individual case. Many European countries have introduced state compensation schemes for victims of violent crimes, which are not based on state liability, but on principles od solidarity and dairness. These national systems differ substantially and minimum standards for state compensation schemes for crime victims are not yet adopted within the EU. To encourage private insurers to cover the risk of terrorism in their policies, governments had to act as insurers of last resort. Problem of liability for damages caused by terrorist act is very specific in Croatian law. Until 1996, the Law on Obligations provided special form of strict liability of the state. During the war in Croatia distinction between war damage and damage caused by acts of terrorism was basic question upon which stale liability depended. Problem of these two types of damage was very hard for the case law and, consequently, this special form of state liability has been abolished by the 1996 revision. The new 2003 Act provides for strict liability of the stale, but with significant limitation justified by the standpoint that state is not liable for failing to prevent terrorist acts; rather, its duty to compensate the victims is expression of principles of solidarity and fairness. Because of that, it is not clear whether a duty to compensate comes from a state liability or it is a sui generis legal obligation of the state.