"CIAT is unanimous in its belief that the federal government must continue to provide a reinsurance backstop beyond 2005 if we are to avoid major disruptions to the economy," Maurin told the committee. He said that already, the insurance industry's fear of the loss or reduction of a federal backstop is becoming apparent in the form of various restrictions now being imposed on renewal polices or those policies that extend beyond Dec. 31. He said those actions will ultimately negatively affect construction lending and debt rating, thereby paving the way for economic damage. Maurin countered the stance taken in the US Department of the Treasury's June 30th report that the insurance industry is now capable of providing terrorism insurance on its own, noting that, if insurers were prepared to handle the coverage without the help of the government, they would not have begun the process of instituting exclusionary notices and cancellations in the form of "popup" exclusions.

Acknowledging that Congress is now faced with either choosing a temporary renewal of TRIA with certain changes as specified by the administration or crafting a new long-term solution to replace TRIA, Maurin spoke about certain criteria that CIAT deems necessary in either case. "First, the program should include a requirement for insurers to 'make available' insurance against the terrorism peril in all lines of commercial insurance to all customers," he said. "Such a requirement is necessary to ensure that property owners and businesses will be able to secure sufficient terrorism risk coverage to adequately protect their assets and their employees who work there."

His testimony suggests that any new program should also be comprehensive, providing coverage for catastrophic events caused by such terrorist acts including nuclear, chemical, biological and radiological attacks, in addition to attacks by domestic terrorists. "Moreover," Maurin added, "the new program should create a system which is sufficiently flexible that it allows the private sector to develop over time alternative forms of capacity to cover the terrorism risk, while still retaining the federal reinsurance backstop during the life of the program."