Passed in response to the effects the September 11 terrorists attack had on the insurance industry and insurance policyholders such as real estate owners, TRIA established a backstop measure in which the government would cover payouts exceeding $100 billion of insurers' annual liability in the event of another terrorist attack. According to a November 2004 study by the RAND Institute for Civil Justice, the attacks resulted in $38.1 billion in insured losses--to persons and businesses--with insurers making $19.6 billion of those payments.

"Overall we find that TRIA was effective in terms of the purposes it was designed to achieve," Treasury officials note in the document. "TRIA provided a transitional period during which insurers had enhanced financial capacity to write terrorism risk insurance coverage. While we don't ascribe a causal effect, during this period insurers began pricing for terrorism coverage and insurer financial strength improved." Treasury officials continued saying TRIA provided "an adjustment period" for both insurers and policyholders. "TRIA's effectiveness for these purposes does not imply continuation of the program."

But many organizations and industry leaders beg to differ with Treasury's assessment of TRIA, among them, the Coalition to Insure Against Terrorism, which had been ardently campaigning Congress to extend the legislation. "The study's assertion that the now partial presence by reinsurers will somehow grow stronger in the absence of a federal backstop defies logic," says Martin L DePoy, CIAT spokesperson and National Association of Real Estate Investment Trusts vice president for government relations; CIAT is a member organization representing businesses and associations ranging from the real estate sector to entertainment industry. "The study also ignores TRIA's value as a mechanism to help the economy rebound quickly in the event of another catastrophic attack."