Terrorism Insurance Legislation Language Clarified

WASHINGTON, DC-Does it, or doesn’t it? It does. The Terrorism Risk Insurance Act of 2002, established in the wake of the September 11, 2001 terror attacks, does provide insurance for losses incurred from nuclear, biological and chemical attacks. The Coalition to Insure Against Terrorism was not so sure, so it sent a letter to the US Department of the Treasury in January requesting clarification on those risks.

In its letter to the Treasury Department, CIAT had pointed out that there was a gross misunderstanding on the topic of nuclear, biological or chemical risks in much of the insurance industry because, “there is no reference, of course, in TRIA to the terms ‘nuclear,’ ‘radiological,’ ‘biological’ or ‘chemical.’ Treasury Department executive director Jeffrey S. Bragg explained in the responding letter that TRIA calls for the government to take on a certain portion of an insurer’s “insured losses” resulting from an act of terrorism, and that those “insured losses” do not exclude nuclear, biological or chemical risks.