Terrorism Risk Insurance Bill Clears House
WASHINGTON – A long-term extension of the federal government’s terrorism insurance backstop, which is critical to New York’s economy, passed the U.S. House of Representatives today. Congresswoman Carolyn B. Maloney (D-Manhattan, Queens), an original co-sponsor of the “Terrorism Risk Insurance Revision and Extension Act” (H.R. 2761), has been a strong advocate for the long-term extension of the law.
“We cannot ignore the risks facing high profile terrorist targets like New York. Terrorism risk insurance put this country on stronger economic footing after 9/11, and regrettably it’s still necessary given the threats the Administration says we still face,” said Maloney. “I applaud Speaker Pelosi, Chairman Frank, and Congressman Capuano for all of their hard work on this important issue.”
“Short TRIA extensions throw the markets into disarray every year and prevent long-term planning and construction. A long-term TRIA extension, like the one included in this bill, is a requisite for economic stability and critical to the full redevelopment of lower Manhattan,” continued Maloney. “The reset provision in the bill will also encourage companies to provide insurance to areas – like New York – that have already been attacked.”
TRIA provides a federal backstop to the insurance industry by providing compensation for a portion of insured losses resulting from acts of terrorism. TRIA requires property and casualty insurers to make terrorism insurance available and provides a government backstop covering 90 percent of insured losses, up to $100 billion each year, after insurer deductibles.
“The truth of the matter is that TRIA saves the government money and protects our economy. We all fervently hope there will be no more terrorist attacks on our soil, but we must recognize that insuring against that dreadful contingency is a fundamental part of making our country safer,” continued Maloney.
TRIA was first passed in the wake of the 9/11 terrorist attacks as a temporary three-year program, and then later extended through 2007. Without another extension, TRIA will expire at the end of this year, leaving many risk insurance policyholders unable to obtain coverage.
· Extends TRIA for 15 years
· Extends TRIA to covers both foreign and domestic terrorism
· Extends TRIA to covers acts of nuclear, biological, chemical, and radiological terrorism
· Sets the “trigger” level – the size of an attack at which the federal government would provide aid to insurers – at $50 million
· Adds group life insurance to the types of insurance for which TRIA coverage must be made available by insurers
March 5, 2007: House Holds NYC Hearing on Extension of Terrorism Risk Insurance Act: http://maloney.house.gov/index.php?option=com_content&task=view&id=1299&Itemid=61
December 17, 2005: Terrorism Risk Insurance Extension Gains Final Passage:
June 30, 2005: Bush Administration Claims Terrorism Risk Insurance is No Longer Necessary: http://maloney.house.gov/index.php?option=com_content&task=view&id=70&Itemid=61
June 17, 2002: Maloney, Corzine Call for Swift Passage of Terror Reinsurance Legislation: