House Receives TRIA Extension Proposal

WASHINGTON, DC-The House Financial Services Subcommittee on Capital Markets, Insurance and Government-Sponsored Enterprises, chaired by Rep. Paul Kanjorski (D-PA), held hearings yesterday on the future of the federal government’s role supporting a backstop for terrorism insurance. The extension of the Terrorism Risk Insurance Act, which was first passed in the wake of Sept. 11, is set to expire at the end of this year. With memories still painfully sharp of the last minute scramble to squeeze out an extension, the American Insurance Association and the Coalition to Insure Against Terrorism have presented to Congress a set of principals that it believes must be considered as Congress takes up legislation to renew the federal backstop.

The biggest area of agreement, according to Martin DePoy, coordinator of CIAT’s steering committee, is the mechanisms developed to encourage insurers to cover NBCR (nuclear, biological, chemical) risk. “We have tried to wall off the insurance companies’ liability so they will be able to better model and place the risk,” he tells GlobeSt.com.

According to duel reports issued last year by the USGovernment Accountability Office and the President’s Working Group on Financial Markets the private market has not provided adequate coverage for NBCR attacks outside of workers’ compensation lines.